May 19, 2013
Tuesday, June 12, 2012
Farm strike slows flow of grain to port
Argentina’s riverboat pilots threatened to paralyze the country’s grains ports by going on strike just as farmers wind down a week-long sales freeze that failed to slow exports thanks to ample dockside reserves.
The sales strike, set to end at midnight tonight, was called last week by growers angry about government agricultural policies and a recent tax increase in number-one soy and corn producing province Buenos Aires.
Argentina is a top exporter of both crops at a time of growing world demand.
“Reserve silos were full when the strike started and we have had no reports of a lack of stocks so far,” said Guillermo Wade, spokesman for the country’s port managers’ chamber.
But just as growers were getting ready to end their sales halt, Argentina’s riverboat pilots yesterday announced a potentially disruptive 48-hour work stoppage, starting today, to demand more hours.
The pilots want to pressure the government into requiring that freighters from neighbouring Paraguay have an Argentine pilot on board while navigating in Argentine waters.
The labour action, which follows a fatal riverway collision involving a Paraguayan ship in Argentina last month, threatens to bog down port activity, Wade said.
“It means that cargo ships will have to line up along the rivers and wait until the strike is over before they can be unmoored. It can cost up to US$20,000 per day to keep one of these ships idle,” he added.
As angry as they are about profit-siphoning curbs on wheat and corn exports imposed by President Cristina Fernández de Kirchner and the land tax increase, farmers were not expected to extend their action past today or repeat the huge tax protests in 2008 that paralyzed the sector.
Many growers are eager to get back to business because they need cash after a six-week dry spell in December and January cut into crop yields.
WORLD SUPPLY CONCERNS
Supply concerns and signs that importers are switching from Argentine to US cargoes due in part to the sales freeze, helped lift soybean SN2 and soymeal SMN2 futures on the Chicago Board of Trade last week.
Argentina is the world’s top exporter of soyoil, used in the booming international biofuels sector. It is also the number-one supplier of soymeal, used as cattle feed, particularly in China, where the fast-growing middle class is clamouring for beef steaks.
The strikes arrive at the height of soy and corn harvesting and at a time of slowing economic growth in Argentina, which is being hit by fallout from Europe’s financial woes and slackening demand from number-one trade partner Brazil.
Trading companies with operations in Argentina include Cargill, Bunge and Noble Group.
Only 881 trucks entered Argentina’s main port of Rosario in the 24 hours through mid-morning yesterday, down from 3,800 on the same day last year, the Rosario Grain Exchange said.
About 80 percent of Argentina’s farm exports are shipped from terminals that line the Paraná River at Rosario, which provides quick access to the shipping lanes of the South Atlantic.