June 1, 2023

Argentinian soybean exporters generate over US$1 billion in one day

In a significant boost to agricultural exports and international reserve accumulation, Argentinian soybean exporters have successfully liquidated more than US$1 billion in the third-to-last day of the "agro dollar III" programme, Buenos Aires Herald reported.

Launched last month, this preferential exchange rate of 1 US dollar to 300 Argentine pesos aimed to mitigate the impact of a historic drought on the agricultural sector.

The latest liquidation of US$1.05 billion brings the total amount generated through the "agro dollar III" initiative to US$5.08 billion. The programme allows agricultural producers to export soybeans, other soy products, and regional agricultural produce, including yerba mate, wine, rice, tea, and wood, at the advantageous exchange rate of ARS 300 to the dollar, while the official exchange rate stands at ARS 239.33.

Originally scheduled to end today, the liquidation deadline for soybean exporters has been extended until Friday to accommodate last week's bank holidays on May 25 and 26. Regional economies have until August 31 to complete their liquidations.

Under this scheme, the Central Bank purchased the entire amount at a rate of ARS 300 to the dollar and subsequently resold US$601 million at a rate of ARS 293.33 to the dollar. Despite the reselling, the monetary authority achieved a net positive balance of US$451 million, the highest since December 29.

While the initial target of US$5 billion specifically for soybean industry liquidations has not been met, government officials had a broader target of US$7 to US$9 billion when considering liquidations by regional economies.

-      Buenos Aires Herald