Foreign currency income from cereal and oil producers in Argentina collapsed by 50 percent over the first 10 months of the year as a result of a severe drought.
The agroindustrial sector settled US$743.5 million in October, falling 25 percent compared to the same month the previous year, a report by the CIARA-CEC crushing and export chamber,
Compared the first 10 months with last year, the cereal-oil sector lost sales abroad to the tune of US$17.539 billion (down 50 percent). The data points to a US$20-billion slump in foreign currency this year.
“The income of foreign currency in October results from the drought, which has caused a loss of available stock of grains, as well as from an electoral process which always conditions the grain market,” read the report.
In addition, the remaining grains from the coarse harvest will limit operations from ports and the soybean grinding industry over the next few months.
The monthly income of foreign currency, converted into pesos, is the mechanism which helps continue buying grains from producers at the best price possible.
The settlement of foreign currency is essentially related to the purchase of grains to be exported afterwards, whether as is or as processed products, after an industrial transformation.
The oil-cereal producing complex, including biodiesel and related products accounted for 48 percent of all exports in Argentina last year, according to data from the INDEC Statistics Bureau.
The main export product in this country is soy flour (14.2 percent of the total), which is an industrialised sub-product made by this agroindustrial complex, which currently has an idle capacity near 50 percent.
The second most exported product last year, according to INDEC, was corn (11 percent) and the third was soy oil (6.9 percent).
– TIMES/NA
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