July 4, 2008

 

Argentina's soy prices up amid uncertainty over fate of export tax

Argentine soy prices were up on the week at the Rosario Grain Exchange Thursday (July 3, 2008), in line with the CBOT, but uncertainty surrounding a Congressional vote on grain export taxes weighed on wheat and corn prices, according to analysts.

 

"Prices were mixed in line with Chicago and the local demand and supply situation," the Rosario Exchange said.

 

"The export tax debate also affected the market and each day appears farther from reaching a solution," the Exchange said.

 

In March, the government introduced a new sliding-scale tax which sharply raised the export tax.

 

Farmers have sporadically blocked traffic in an on-again, off-again strike since March, causing food shortages in the cities and cutting off grain exports.

 

Farmers lifted their strike last month and shifted efforts to lobbying Congress to vote down the tax.

 

While the government seems to have secured the votes needed to pass the export tax bill, the agriculture committee continues to debate the tax, and delays are causing concern.

 

A House vote is not expected until next week.

 

The government has modified the bill to exempt a larger amount of small-scale farmers, but farm groups have called the move insufficient.

 

 

Soy

   

"Soy prices are rising in Chicago and local sellers are waiting for better prices before making deals," the Exchange said.

 

Spot soy traded at ARS910 (US$300.58) per tonne at the Rosario Grain Exchange Thursday, up from ARS900 last Thursday.

 

 

Corn

  

Corn prices eased on low demand from exporters, the Exchange said.

 

Spot corn traded for ARS520 per tonne Thursday, down from ARS530 last week.

 

 

Wheat

  

Local millers paid ARS650 for wheat with a minimum gluten count of 26, down from ARS680 a week ago.

 

Exporters focused on the new crop, paying US$190 for January 2009 wheat.

 

(US$1=ARS3.03)