Argentina-Farmers want dialogue.
ARGENTINA-FARMERS LOOK FOR DIALOGUE.
Argentine farmers Thursday postponed plans to go on strike, calling instead for talks with President Cristina Fernandez to find solutions for a sector reeling from the worst drought in decades..
"We’ve decided to postpone any kind of protest and reiterate to the president that we want to talk," Eduardo Buzzi, president of the Argentine Agrarian Federation, said at a televised press conference in Buenos Aires.
Earlier Thursday, farm leaders suggested they would go on strike and freeze sales of grains and other products for up to five days next week. The effort would aim to put pressure on the government to help improve sagging profits as the drought reduces planted and harvested area, crop yields and estimated production for the 2008-09 season.
"The situation is becoming worse every week," Buzzi said after a six-hour meeting with other farm leaders, who last year held a four-month protest that led to the overturn of a hike in export taxes.
Instead of going on strike now, farm leaders are "willing to help," Buzzi said.. "If the president calls us to find solutions, we are ready to participate.."
He described the efforts of the government so far to help the sector as "announcements void of content," adding that officials have been cagey about meeting with them.
Among other things, farmers want permission to export more beef, grains and milk, plus initiatives to ramp up domestic demand for farm products and help cattle and crop farmers suffering from heavy losses to the drought.
The biggest demand is for a reduction or a suspension in export taxes, which run as high as 35% on soybeans, the country’s biggest crop.
"There needs to be less tax pressure on the sector," Ernesto Ambrosetti, the chief economist at the Argentine Rural Society, told Dow Jones Newswires earlier Thursday.
"None of the government’s measures so far have improved the situation for farmers," he said.
Export taxes "are very high," at 35% on soybeans, 32% on sunseed, 23% on wheat and 20% on corn, he said.
The tax burden is slashing farm profits already hurting from the drought. Ambrosetti estimates the dry spell will cut Argentina’s total crop production to 75 million tons in the 2008-09 season from 95 million in the previous season, leading to a loss of $5.7 billion in grain sales.
The tax drain and loss in crops will leave farmers with less capital for investing in the 2009-10 harvest, what could lead to less production that season..
"The big question is what will happen with the next harvest because of the losses from the drought," he said.
On Tuesday, the U.S. Department of Agriculture reduced its estimate of Argentina’s 2008-09 soybean production by 11.5% to 43.8 million metric tons on the drought’s impact on harvested area and yields.
It also reduced its Argentine corn output forecast by 18.2% to 13.5 million tons and that for wheat to 8.4 million tons from a previous estimate of 9.5 million.
