Wednesday, January 19

Producers reject intervention in markets

Faced with this reality, the Ministry of Agriculture decided to establish “equilibrium volumes” to prevent the foreign sales declarations of both crops from compromising the domestic supply at some point. Through the Resolution 276/2021 it was established that When the equilibrium volumes of 90% are reached and corresponding to the additional margin of 4%, the foreign sales declarations must be made in accordance with a special regime.

This measure generated the rejection of the four chains that make up the most important productive matrix in the country: wheat, soybeans, corn and sunflower. In a harsh statement, they assured that “the interventions have never served to lower prices.” From Maizar -which represents corn producers- they confirmed to Ámbito that “in Argentina there was never a lack of corn for the domestic market” and stressed that “while the market was open, without regulations, there was never a shortage for local transformation” .

Miguel Cané, President of Argentrigo, assured in dialogue with Ambit that “The government does not have to worry about the provision of the domestic market. They are recreating a situation that we already live in and where we have a very bad time. We ended the year in the same way as 2020, discussing quotas and exportable balances ”.

Another situation that generated a lot of commotion among producer entities is the possible creation of a trust that would seek to “unlink” internal prices from external ones and subsidize sales of flour, bread, noodles and chicken. Although there are retentions for these situations, that would not be the mechanism that Domínguez would be willing to promote, since the problem of internal prices became clear in recent weeks that it is not a specific issue for Agriculture.

In any case, everyone agrees that the trust or the increase in withholdings would complicate the producer equally. Cané explained that “the exporter pays according to what is left for the purchase, therefore all costs are transferred to price and there the producer is harmed. In reality, whenever markets are intervened, it is the primary producer who loses. Exporters and industrialists have other purchasing power and tend to be better accommodated, but in this case the producer loses and furthermore discouragement is generated for the next planting ”.