What started last Thursday as a 48-hour strike to protest an increase by the Argentina government of the export tax on soybeans has been extended. Grain trade across the country has stalled as farmers block highways in many areas.
Although exporters have been able to continue loading ships, the grain exporter group CIARA issued a statement against the tax increase. Grain exchanges have also condemned the hike and the farm supply chamber joined the strike on Friday.
Last Tuesday, the government announced a new sliding scale on export taxes that increases rates as export values rise. According to the Argentine economic minister the new program will be in place for the next four years.
The new scale raised export taxes on soybeans from 35% to 46% based on the government's most recent reference price. Farmers complain that the tax will depress domestic prices.
"We’re tired of this government that is a partner in profits but not in losses, that doesn’t return to the interior of the country what we contribute," said Argentine Agrarian Federation President Eduardo Buzzi.
The government says that farm prices are soaring and that several supports and subsidies have benefited farmers. Cabinet members say the strike is a complete overreaction, and that in addition to raising revenue the tax will stop the expansion of soybeans instead of other crops.
"Soy competes directly with other products that we want to stimulate such as meat, milk and wheat," Economy Minister Martin Lousteau said when announcing the new taxes. "We want to guarantee domestic food supplies at prices within reach for Argentina’s families."
Nearly all soybeans produced in Argentina are exported and production far exceeds that of wheat, corn and sunseed.