September 2, 2022

Grain exports from Argentina reached US$3.4 billion in August

CIARA-CEC, the combined oilseed industry and grains export chambers industry group, said that Argentina's grain exports brought in US$3.4 billion in August, a 5% increase from July, as the South American nation attempts to increase the flow of foreign currency to replenish depleted central bank reserves, Reuters

The annual value of farm exports increased 11% year over year in the month to reach $25.7 billion, according to CIARA-CEC.

Exporters of grains are required by Argentina's central bank to convert their dollar payments into pesos.

Although analysts claim the economy ministry is looking into a specific exchange mechanism for the farm sector to promote the liquidation of dollars, the South American nation has strict currency controls to preserve limited reserves.

Argentina ranks first in the world for the export of processed soy oil and meal, third for corn, and a significant wheat producer. However, because of worries about a peso devaluation, soy farmers have been selling their crops more slowly than in previous years.

In addition to the effects of a volatile macroeconomy and exchange market, CIARA-CEC noted that grain exports have been affected by adverse weather effects on the bulk harvest.

The report said this has increased the idle capacity of the soybean crushing industry, which continues to operate at a loss even in the middle of harvest season and is causing production shutdowns.

-      Reuters