Argentina-The King of Soy farming.

ARGENTINA-THE SOY KING SPEAKS OUT.

Argentina’s "soybean king" Gustavo Grobocopatel, after keeping a low profile during a year-long dispute between Peronist President Cristina Fernández de Kirchner and the farm sector over export duties, has come out in strong support of farmers who argue that her government is mainly to blame for the country’s crops plummeting by a third this season.

"Duties favour the concentration of land in a few hands because they don’t tax profits but revenue," he told the Herald, echoing claims by the liaison board formed by the leaders of the country’s four main farm lobbies: FAA, CRA, SRA and Coninagro.

"With the duty system farmers continue to pay even when they lose money. Farmers who earn the least — that is, in the years that they actually earn money — get a lot less. And not only that system concentrates riches in a few hands, but also leads to a concentration in the richest areas."

Grobocopatel spoke at a meeting of the Argentine Productivity Movement (MPA). The MPA think-tank is led by former Peronist caretaker president Eduardo Duhalde, who has admitted that he regretted having helped Néstor Kirchner to make it to the presidency in 2003 and who is forging an anti-Kirchner pole with a view to the June 28 mid-term vote and the 2011 presidential elections.

Grobocopatel was one of Argentina’s leading businessmen who accompanied then President Néstor Kirchner to Venezuela, where Kirchner and his counterpart Hugo Chávez agreed that Argentina would supply Venezuela with food and oil-rich Venezuela would supply Argentina with energy.

Farmers in Argentina — one of the world’s largest food exporters — staged seven sales boycotts and hundreds of roadblocks in a drive to force Fernández de Kirchner to reduce exports duties. She refuses to rebate duties arguing that farmers have been getting windfall profits and that she needs the money to foster a more even income distribution and to redress the balance among Argentine crops, upset after a soybean boom that has led Argentina to become the third-largest soybean exporter after the US and Brazil.

Grobocopatel said that duties pose the risk of Argentina going "too soy."

"Duties are soybean-prone because they affect wheat and corn more than soybean," he said. "It is highly likely that this year we may have to import wheat."

Amid their dispute, Fernández de Kirchner has gone as far as accusing farmers of seeking to topple her and to reap political benefit ahead of the mid-term vote where she risks losing control of Congress.

Farmers claim that the government is fleecing them and taking them as scapegoats for a deep crisis at home — including increasing poverty, inflation and crime — that started well before the global crisis erupted and made commodity prices plunge. They have been accusing her administration of fostering the concentration of land in a few hands, a claim that has been now backed by Grobocopatel.

In March last year, when international food prices were booming on the back of a strong demand from China and India, Fernández de Kirchner sharply rose duties but four months later Congress forced her to roll them back to the current 35 percent.

Food prices later plummeted amid the global crisis. Farmers are also facing the worst-ever drought spell in Argentina, but they say that beyond the global crisis and the drought, distorted and discriminating government policies are the main culprit for a harvest of about 70 million tons of grains and oilseeds, according to private estimations, compared to 98 million tons the previous season.

Argentina is also the world’s largest supplier of sunseed, the second-largest of corn and the four largest of wheat, and is one of the largest exporters of sorghum.

The US Department of Agriculture recently downgraded its estimate of Argentina’s soybean crop for the current 2008-2009 season by 15.5 percent to 39 million tons from 46.2 million the previous season, and reduced its estimate of Argentine soybean exports by 27 percent to 10.1 million tons from 13.8 million in the previous season.

Grobocopatel, whose company is called Los Grobo, said the drought is "terrible," adding that Buenos Aires province, the country’s richest, is heading to losing half of its harvest.

Farmers estimate that the wheat harvest will decline to eight million tons from 16 million last season and that the country may be even forced not only to import wheat but also corn and beef.

The Argentine rodeo has fallen by about three million head of cattle from 55 million. The whole arch of economic sectors linked to farm activity is in dire straits.

Duhalde followers attending Grobocopatel’s presentation at the MPA — which is headed by farmer and former deputy Carlos Brown — asked him to comment on the fight of the farmers’ liaison board for lower duties.

He said: "They have done a great effort to stay united and leave aside the historical conflicts that had kept them apart. They have made a strong effort to unite behind an idea that is the defence of the hinterland, and that is valuable."

Now "they have to go for more," said Grobocopatel, adding that for eight years he was a representative of CARBAP, a lobby that is part of CRA, which represents farmers in the provinces of Buenos Aires and La Pampa.

"The liaison board should be an instrument to lure more people, to generate an environment of debate, of consensus about public policies, to integrate the farm sector with other sectors," said Grobocopatel answering written questions made by the audience.

"The problem with farmers is that they are always very self-centred. We have difficulty in connecting with issues from other sectors. This is in the very nature of the farmer, a man who lives alone in the countryside, or in his small town. We talk to each other, read the same agricultural supplements, but don’t even dream of farmers sharing a barbecue with a picket movement, for instance. We need to create much more liaisons," he said.

Despite his comments, farmers are already engaging in a wide range of activities aimed at championing their cause. After having lost hope of a government solution in the face of Fernández de Kirchner’s stiff rejection of a possible reduction of duties, they are now pinning their hopes in Congress and several of them — although none of the four lobbies’ presidents — will be running for Congress in the June 28 mid-term vote that the government brought forward alleging the prospect of governability problems amid the global crisis.

Last month 18 opposition parties drew a bill aimed at reducing export duties but they fell 21 seats short of the Lower House’s 129-seat quorum. They expect that after the June vote and an intense lobbying of legislators they will manage to get quorum to debate the bill.

The dispute with the farm sectors has made the public image of Fernández de Kirchner to plummet.

The Herald asked Grobocopatel whether pools and other not so large groups were facing difficulties to find land to rent. He replied: "There is no renting at all. Everything is at a standstill."

He was also asked what measures should adopt Argentina and what measures have led him to invest in Brazil. He replied: "That of Brazil is not a short-term decision. The vision of my company is to become a large multinational of Mercosur," the trade bloc formed by Argentina, Brazil, Paraguay, Uruguay and Venezuela.

"This world where Mercosur is the future of agriculture and protein has not a single multinational to compete with the US and European multinationals. My dream is to retire in 10 years, have a coffee in some bar in the Ukraine, Angola or China, and listen local producers ask ’what does Los Grobo’ mean?"

"I want to build a large multinational. To do so it is important to be in Brazil, which has a size and dynamics that make it easier to jump into the world from there than doing i