beyondbrics

By Daniel Schweimler in Buenos Aires

Amid growing worries over a global food price shock, today’s news from Argentina doesn’t bode well: farmers have said they’ll suspend the sale of all grains and oilseeds for a week from next Monday.

The announcement came after talks broke down between the four main farmers’ organisations and the government over how much wheat producers should be allowed to export.

The farmers’ leaders left the meeting visibly angry. Their chief spokesman, Hugo Biolcati, told Argentine television that they were hearing more of the same from the government. “They haven’t listened to what we’ve been asking for,” he said. The minister for agriculture, Julián Domínguez, said that farmers would have to “explain themselves to Argentine society.”

The Argentine government has announced that it will allow the export of up to 8m of the 14m tonnes of wheat expected to be produced this year. The farmers want to be able to export more, saying that prices have collapsed and it’s become difficult to find buyers for their produce.

Argentina is one of the world’s leading exporters of grain, with more than 16 per cent of the world market, and the second-largest exporter of oilseeds, mostly soya and sunflower.

A large part of the government’s income is raised from taxes levied on agricultural exports, especially the fast-growing soya industry.

The breakdown in talks heralds the end of an uneasy peace that has existed between the two sides since a bitter conflict in 2008 over taxes levied on soya exports.

That led to farmers blocking roads, food shortages in Argentina’s major cities, a drastic fall in exports and a subsequent price rise on world grain markets.