A package of measures to encourage farmers to increase grain sales in the final quarter of 2020 has been announced by the government of Argentina, Reuters reported on 2 October.
The measures included a reduction in soyabean export duties from 33% to 30% for a 90-day period.
Taxes on processed soya meal and soya oil would also be temporarily cut to varying rates at around 28%, according to a breakdown of the measures made available by the Economy Ministry. All rates would then gradually rise again until January.
“We are seeking to strengthen the country’s international reserves,” economy minister Martin Guzman was quoted as saying at an event in Buenos Aires to announce the measures.
However, farmers and analysts said the move might not be enough to significantly boost sales as the government entered debt negotiation talks with the International Monetary Fund.
The country’s CIARA soya crushing companies’ chamber issued a statement saying the tax cut plan was insufficient.
“CIARA has always held the position that all export taxes and restrictions on grains and their derivatives are distorting to the market. We would support a schedule for the reduction and elimination of such duties,” the statement said.
Santiago del Solar, a Buenos Aires farmer, was quoted by Reuters as saying he expected buyers to take advantage of farmers rushing to market during the three-month tax cut window.
“Everyone knows we want to sell during these 90 days, including the buyers. They will lower the prices they offer during these three months, so the benefit of the tax reduction will never reach the farm,” del Solar said.
Argentina’s economy had been shrinking since 2018 and had been further affected by the COVID-19 lockdowns, Reuters said.
Farmers in the country had sold 32.2M tonnes of soyabeans from the 2019/20 season, about 60% of the harvest and 4.4M tonnes less than at the same point in the previous year, according to official data.