Argentine landowners stage 4-day farm lockout over export tax hike

[sandensea]

Argentina's Liaison Coordinator of Agricultural Entities (CEEA), the country's top agricultural lobby, launched a 4-day grain and beef marketing lockout today.

The lockout was ordered in protest over an increase in export duties for soy by 3 points, from 30% to 33%, for farms producing over 1,000 tons.

The new rate - which follows a 5.3-point hike passed by Congress on December 21 - is the legal maximum set by President Alberto Fernández, who took office in December amid the worst debt crisis and recession in two decades.

Over 74% of farms will see no change in export tax rates, which are on a sliding scale from 20% for those producing 65 tons or less, to 30% to those up to 1,000 tons. The nation's 24 other export crops were not affected.

This week's lockout has failed to achieve the near-total compliance seen during the 2008 lockout - mainly because the 3-point tax hike only applies to larger farms, many of which are corporate-owned.

"70% of farmers in the Argentine Agrarian Federation (FAA) are not taking part in the lockout," Nélida Sereno, head of the FAA's Tandíl chapter, noted. Incidents of lockout supporters stopping grain trucks were reported.

The Port of Rosario, the nation's leading shipping point for soy, recorded 4,324 trucks today - about average for a Monday in March, and a 72% jump from last Monday. Cattle transport was likewise higher.

In context

The world's third-largest soy producer, Argentina produced 55 million tons of soybeans last year and exported $17 billion of soy and derivatives - some 26% of total exports.

President Fernández is currently overseeing negotiations over a restructuring of over $70 billion of the country's $195 public foreign debt.

Today's soy export tax hike is projected to raise a net $274 million in added revenue.

Former FAA head Eduardo Buzzi, who helped lead the 2008 lockout, has come out against this week's lockout.

"Any (tax) hike bothers farmers," he noted. "But this has to be viewed in context - with 38% poverty, and large part of society that's been screwed."

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The heads of the five groups making up the Mesa de Enlace ("Liaison Roundtable" ) - Argentina's main agricultural lobby - walk past the Agriculture Ministry following tax hike negotiations last week in which they had "ruled out a lockout."

This week's about-face was attributed by some to lawmakers belonging to the right-wing "Let's Change" coalition that was defeated in last October's election.

"There's a sector (among landowners) fanning protest, ignoring political logic and ongoing negotiations," a prominent small farmer, Eduardo Buzzi, lamented. "Some farmers take political opposition as a vocation."