Argentine farmers are shrugging off high soy prices and hanging onto all the beans they can this season in a bid to avoid exposure to the country’s anemic peso currency, even as rival growers in Brazil and the United States rush to sell.
Uncertainty abounds ahead of October congressional elections and farmers fret that the vote might set the stage for increased government intervention in the agricultural markets.
Argentina currently slaps a 33% export tax on soybeans, 31% on soymeal and soyoil, 12% on corn and 12% on wheat.
The official peso rate has meanwhile swooned 29.6% in the 12 months through Thursday to 92.4 per dollar.
With this kind of currency volatility, Argentine farmers have decided a bean in the bag is better than a peso in the bank.
Argentina is the world’s top supplier of soymeal livestock feed used to fatten hogs and poultry from Europe to Southeast Asia.
However, as of March 31, farmers had sold only 31% of their soon to be harvested 20/21 soybeans.
At the same point last year, sales of the 19/20 crop were at 37%.
According to Datagro, Brazil farmers, in contrast, sold 66.6% of estimated soy output through April 2, well above a 57.1% five-year historical average for the period.
Datagro also projects Brazil soybean output at 135.48 million tonnes in the 2020/2021 crop year.
Source: Reuters
