Strong rejection of the field to the new intervention in the wheat and corn markets

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After the government set this friday “Equilibrium volumes” to regulate wheat and corn exports, from the Liaison Table (made up of CRA, Agrarian Federation, SRA and Coninagro) strongly questioned Resolution 276, published in the Official Gazette.

In dialogue with TN, the president of the Argentine Agrarian Federation (FAA), Carlos Achetoni, repudiated the decision made by the Minister of Agriculture, Julian Dominguez. “We do not see appropriate that these tools of control, slowdown and disconnection of international prices are applied, at a time when the harvest is also taking place with a good yield. Ultimately, this allows concentrated export sectors to buy at a depreciation (from producers) and then export at full price ”.

Read also The Government established that there will be “equilibrium volumes” to regulate wheat and corn exports.

The FAA head questioned that Domínguez had taken a “Unconsulted decision” after having met with the Liaison Board a short time ago, to agree on the regulations for the meat industry. “We came from a week where we met and we were told that they would not apply regulations because there was no need to do so, but now this comes out. No message of certainty is left. You cannot say one thing in a meeting and then come out with a regulation that was not anticipated at that time, nor later ”.

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The president of the Sociedad Rural Argentina (SRA), Nicolas Pino, he emphasized: “From our entity for months we have been denouncing that self-regulations, formal or informal, as well as a record of exports without operation, or this quota for wheat and corn, harm the country and hurt us all” .

Regarding the “balancing volumes” for the moment established for the 2021/22 campaign, which would be 12.5 million tons for wheat and 25 million for corn Until the numbers of the new crop are known, Achetoni asserted: “In neither case was it necessary to mark it that way, because it is very premature and generates an inverse reaction.”

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Meanwhile, from the SRA they evaluated: “Interventions based on an arbitrary exportable balance set by the Government, generate an artificial oversupply, depressing prices and making it difficult to commercialize products, in addition to projecting a fall in national productivity.”

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On the other hand, Argentine Rural Confederations (CRA) He pointed out: “The country’s production is not promoted by setting limits that distort its growth. The effect of measures of these characteristics is verified by looking only at recent history, when, from a package of regulations with the same characteristics, there was a phenomenal transfer of resources from the primary productive links to other links in the chains. As a result, the largest drop in planting intentions in history was seen, bringing national production back to rates close to those of 100 years ago “

On this, they warned: “The answer will be manual, and it is that in front of not very transparent mechanisms what is generated is a high dose of uncertainty that triggers negative expectations; rearticulating productive proposals and expanding safety margins in order to avoid these uncertainties ”.

In this sense, Achetoni clarified that “nobody is opposed to guaranteeing the internal supply, but this it affects the primary sector, especially the small producer ”.

“When the natural bid by buyers for export and domestic consumption is distorted, they generate economic inefficiencies that make room for income transfers between different links in the chain. Producers need to regain the path of market transparency, to restore the confidence of economic actors, “the SRA said in its statement.

Finally, from CONINAGRO they evaluated that “the recent measures regarding the granary market merit reflection on them in a complex context for the sector and for Argentine society.”

“At CONINAGRO we uphold the importance of free access to markets, their non-intervention, and the need to generate predictability and trust in people. We ratify that the best way for the agricultural producer to contribute to improving the general situation of the country is with greater and better sustainable production. For this, nothing better than the freedom of production, commercialization and access to markets ”, they remarked.

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However, they pointed out: “The recent restrictions are understandable only to successfully overcome a picture of tight supply for the domestic market and potential export demand, and only as extraordinary and temporary, and in the face of emergencies. And only to overcome the situation, making shared efforts in pursuit of the general welfare, and counting on the participation and agreement of all sectors, in intersectoral tables convened by the Ministry ”.

Domínguez defended the measure despite criticism from the field

However, Domínguez made public statements justifying the decision: “It is a resolution that the chain considers necessary to provide predictability and confidence, and safeguard what Argentines need to consume ”.

According to the official, the regulations “establish clear, pre-established rules in common, as recorded in the corresponding minutes. Figures of 41.6 million tons of corn (data from the previous harvest) and 12.5 million tons of wheat (figure for the current season) are set for international markets, so that they do not compromise supply to the market internal”.

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Then he added: “Therefore the data comes from the Sectorial Table that was institutionalized to build decisions that give producers predictability and confidence, so that they are not hostages of untimely and untimely measures that only benefit large exporters” .

The wheat and corn chains also repudiated the intervention

Consulted by TN, the president of ArgenTrigo, Miguel Cane, opined: “Throughout the chain we consider that the intervention of the markets is a mistake, because every time that happens, there are winners and losers. This has already happened with Kirchnerism, and it ended in the least wheat sowing in recent years ”.

In addition, he evaluated that “everyone ends up losing” with these decisions. “Someone can benefit at a certain time, at first, but finally we all lose when there is little wheat. Nobody considers this to work or to be successful ”.

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Likewise, in a week in which the Executive also ordered the freezing of bread and flour, he emphasized: “The Government does not have tools to lower inflation, so it needs to intervene in the markets to lower prices, be it wheat, corn or meat, among other things. It is known that the impact of cereals on meat is less. Wheat only affects 15% of the price of bread, food for which a resolution was also drawn with the intention of freezing it. But it is all political, for the rostrum, when in reality it is somewhat inefficient, that it is useless ”.

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For its part, the Argentine Corn and Sorghum Association (Maizar) he remarked: “We disagree with Resolution 276, which sets equilibrium volumes to meet domestic demand. There was never a lack of corn in Argentina for the domestic market. In fact, while the market was open, without regulations, there was never a shortage for local transformation ”.

The role of the Advisory Council

As with meat, the resolution created a consultive advice to monitor the activity with the sector tables, with which the officials had already been holding meetings.

On that, Achetoni stated: If they are going to ask us what we think and then do whatever they want, the truth is that it doesn’t make much sense “. Meanwhile, Pino doubted that the SRA is going to join it: “We will decide if we are going to participate.”

For his part, Cané de Argentrigo considered: “If they are going to do something wrong, such as intervening, it is preferable to be involved in some way, to be able, at least, to point out that the 12.5 million tons of wheat seem little (established as a ceiling in the resolution), in a harvest that is shaping up to 22 million. In reality, it would seem that there is scope to export at least 14 million ”.

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