March 29, 2010
Argentina grain-port strike seen ending soon, but causes alarm
An Argentine port-worker strike, extending into its fourth day Friday (March 26), is expected to end relatively quickly but is causing concern over grain-export disruptions.
Argentina leads the world in soymeal and soyoil exports, and it is the third-largest soybean exporter.
Striking workers have blocked access two port complexes lining the banks of the Rio de la Plata in Rosario, Argentina's main grain export hub. The stoppage has stalled operations at Cargill Inc. and Bunge Ltd.'s (BG) local ports, as well as terminal 6, shutting down shipments from about half of the port capacity in the area, said a representative from Rosario.
While a deal was likely to be reached within the next days and the strike lifted, the stoppage is rattling nerves as the soy harvest is set to go into full swing next week, said Granar SA analyst Adrian Seltzer.
Unions frequently push demands at this time of the year, when exporters are under pressure to get boats loaded fast, Seltzer said.
Argentina is on track to grow a record soy crop this season, which is already likely to test the country's transport, storage and shipping capacity.
The crop is seen coming in at between 51-55 million tonnes, with most analysts pointing to the higher end of that range, up from Argentina's previous record of 48.8 million tonnes grown in 2006-07.
Meanwhile, Argentine soy and corn prices eased on the week as good weather conditions allowed farmers to push forward the harvesting of the bumper crops.
Spot soy traded at ARS830 (US$214.80) and ARS835 (US$216.09) a tonne in Rosario on Friday (March 26), down from ARS840 (US$217.39) and ARS850 (US$219.98) on Thursday of last week. Trade volume on Friday totalled 20,000 tonnes.
May 2010 soy futures traded at US$215 and US$217 a tonne, down from US$218 and US$225 last Thursday, with low trade volume.
Meanwhile, corn futures eased a bit this week despite labour problems at a few ports as the harvest pushed forward, the Rosario Grain Exchange said.
May corn contracts traded at US$108 and US$110 a tonne in Rosario on Friday, down from US$110 to US$114 last Thursday, with about 2,000 tonnes changing hands.
Wheat was not traded again Friday as farmers keep waiting for higher prices agreed between the government and exporters.
Under the price accord reached late last year, wheat exporters agreed to pay farmers a theoretical Free-Alongside-Ship price calculated based on the international price minus export taxes and costs of getting the grain to port.
However, trade has been virtually stalled since December as buyers balk at paying the full price and sellers hold out.
