September 23, 2020
CIARA-CEC: Argentina's soy crushing volume to fall 9.5% in 2020
Gustavo Idígoras, head of Argentina's CIARA-CEC grains exporting chamber, told Reuters that Argentina's soy crushing volume is set to fall about 9.5% in 2020, which is important for the world soy market and Argentina's inflow of hard currency, Reuters reported.
Idígoras said Argentina had been affected by lower grains flow, higher taxes and foreign exchange market volatility.
He said Argentina's soy crushing plants are set to crush about 38 million tonnes of soy this year, compared to 42 million tonnes last year, adding that idle capacity was at 50%.
Argentina is the biggest exporter of processed soymeal and soy oil in the world.
Idígoras said soy's lower profitability has made it difficult to increase prices paid to producers, with less of the grain coming from farms to processing plants.
Argentina requires a solid inflow of dollars from exporting industries such as grains, especially as the country continues to suffer from recession since 2018 and is managing a precariously low level of foreign currency reserves.
Argentina's centre-left Peronist government has imposed tight currency controls, limiting dollar access and increased taxes on agriculture products.
Soy crushing volumes in Argentina have been on the downtrend in 2020, with a 20% drop in August.
Argentinian government data showed the country exported US$12.25 billion worth of soymeal and soy oil. The Rosario grains exchange projects Argentina will produce 50 million tonnes of soybeans this season. Planting is set to begin in October.
In the 2019 / 2020 crop season that ended in July, Argentina harvested 49 million tonnes of soybeans. This is lower than the previous season's 55.3 million tonnes.