The field says it’s part of the solution, not the problem

In a week convulsed by the new change of command in the Ministry of Economy in less than a month, and a few days after the president Alberto Fernandez put agricultural producers in the dock for delaying soybean sales, the main act of the Rural Exhibition of Palermo was the framework to insist on a message: the countryside is part of the solution to Argentina’s problems, not an obstacle. This was stated by the president of the Argentine Rural Society (SRA), Nicolas Pino, in his speech when recalling the fact that foreign currency settlements for exports originating in the field reached 19,000 million dollars in the first half of this year, a figure that exceeded “the historical average by 90%,” according to what he said. “Seven out of every ten dollars or other net currency that enters the country originates in the countryside,” he added. The rise in international prices for soybeans, wheat and corn was the main reason for the increase. Russia’s invasion of Ukraine, two key countries in the world food market, accelerated this trend that had been registered with the end of the pandemic. In this global context, the field seeks to make it clear that there is no occasional advantage that causes profits. extraordinary. In the last 20 years, the economic growth of China and the countries of Southeast Asia, added to the expansion of biofuels as renewable energy, caused an explosion in the demand for grains and meats. This process did not reach its ceiling. And few countries in the world are in a position to rise to the challenge. Argentina is one of them. The other message that was transmitted in the central act of Rural de Palermo is that Argentine agricultural production is stagnating as a result of the distorting intervention in the markets and tax pressure. “Total agricultural production is today stagnant at 130 million tons,” Pino said, and recalled that meat exports fell by 11% since the government of Alberto Fernández imposed the stocks on meat cuts. Added to this interventionist policy is the exchange rate gap, the real reason for the decision of meat producers. take soybeans as a safe currency against the rapid depreciation of the peso. “When the producer wants to pay for the inputs he needs to produce, he finds a dollar that is worth around 300 pesos; but when, much later, he goes to sell his production, he charges a dollar worth 130, also taking away the export rights. So, for example, in the case of soybeans, the value of that dollar received by the producer is less than 100 pesos”, explained the president of the SRA. In this context of an inclined field, in the field they also wonder what the State did with the income from export duties (withholdings). Pino highlighted it in his speech. “In these 20 years, the State benefited: the producers transferred, through retentions, no less than 130,000 million dollars. At today’s values, it is a figure equivalent to the money invested in the Marshall Plan, which raised the whole of Europe after the second world war”, he said, and wondered. “What have the governments done with the money from the withholdings? Have they invested in roads, hospitals, schools, administration of justice, attention to the population?” And it was answered: “No, they have wasted the money in distributing subsidies, instead of promoting the culture of work”. : inside the country. The economic movement caused by corn, wheat, sunflower or soybean crops is not reduced to the income of agricultural producers. It involves the truckers who carry the grain, the young agronomists who go through the fields to monitor the crops, and it reaches the restaurants in the towns.A large audience visited the Rural Exhibition of Palermoprensa GCBA“Our agro-industrial sector generates more than a third of the entire labor force in the country: from the entrepreneurs and the workers who carry out the enormous variety of tasks of production and processing of the fruits of the field, to the network of scientists, technicians, marketers and transporters, who sustain productive work day after day”, Pino highlighted. And he recalled that there are 227,000 producers and 25,000 establishments and companies “that transform what the field produces.” The ruralist argued that there are “almost four million workers, direct or indirect, who bring employment to all points in the interior of the country.” These are data that contrast with the belief that the field does not generate value or is important in terms of employment. The impact on foreign exchange and employment of the field is the main argument of the agro-industrial promotion law that has just begun to be discussed in Congress. The initiative, born from the private sector, proposes granting fiscal and financial stability and specific incentives to agriculture to generate an increase in exports from US$65,000 to US$100,000 million and the creation of 700,000 jobs. This, without neglecting the domestic market. The newly appointed Minister of the Economy praised the initiative last February, although he did not do much to speed up its treatment in Congress. Now, from the fifth floor of the Palacio de Hacienda, he will have the opportunity to carry out the project, although he has a limit that he expressed in his first contacts with the rural leadership: not to lower export duties. But beyond the law, Massa has a more complex task: reestablish trust with agriculture. In the coming weeks, producers will begin to make decisions about planting corn and soybeans for the 22/23 agricultural campaign, which will have an influence on next year’s foreign exchange earnings. A wrong step with agriculture will have negative effects.