Production of soybeans here is anticipated to increase 66 percent to 53 million tons, according to Ray Nabors of the Heartland Ag Network. The USDA, The Rosario Grains Exchange, and the Buenos Aires Grains Exchange each came up with almost the same figure.
Argentina is now the world's second largest exporter of soy ...and still the largest soybean oil exporter, at the same time.
Why is soy pushing cattle (and lot of other things!) off the Argentine map?
Because even with a 35% export tax, producing soybeans is perhaps the safest and most profitable bet in food production here... mainly because there are no restrictions on the amount of it that can be exported. And farmers are relatively confident that there will be no export restrictions on soy.
When it comes to planting-time, farmers are some of the most steely-eyed gamblers I've ever met. They look at their empty fields and put their money on those huge squares like players at a roulette table.
Then, they wait as the giant wheel of wind, rain, cold, bugs, microbes, international price fluctuations spin. If it breaks bad, you can lose it all ...and have no money to plant next year.
All the variables on that wheel have been with farmers forever; that's the way the game is. If, however, there are possible, unannounced, after the fact, surprise restrictions on your ability to sell certain crops to some people (foreigners, for example) or the price you can sell them for ...you're probably going to look for a safer bet.
That's what's happened with cattle for years and, today, Argentine wheat farmers are peddling their harvest from door-to-door with no buyers due to export restictions; their traditional buyers on the world market are afraid to enter into contracts for fear that those restrictions could nullify them.
It's a confidence game ...no confidence, no game. Don't expect many wheat farmers to return next year ...and there aren't enough ranchers left to bring traditional Argentine beef back to your plate.
Tofu anyone?
2 comments:
I am local. I am Argentina. Trust me....this problem is an old problem with the power and workers in the lands...
My country is special...many people try to understand it, but is imposible.
I still consider myself a rookie in all things Argentine, Ana, but after living and working here for more than 6 years, I'm getting smarter.
Yep, it's an old problem and this is a special country ...and I love it!
Post a Comment