Argentina reopens soy oil, meal exports

The reopening follows a 2% export tax rate hike
calendar icon 22 March 2022
clock icon 2 minute read

Argentina's government will allow new soy oil and meal exports to be registered from Monday onwards after hiking the tax rate on the two products, its main source of foreign currency income, reported Reuters.

The South American country, the world's top exporter of processed soy, halted new overseas sales of soy oil and meal in mid-March before hiking the tax rate to 33% from 31% previously in a bid to tamp down domestic food inflation.

"Registrations of the Sworn Declarations of Sale Abroad, corresponding to soybean meal and oil, is opened from 00:00 hs. on 21 March 2022," the agriculture ministry said in a statement late on Sunday.

Argentine farmers will start to harvest the 2021/22 soy crop in the coming weeks, with global prices soaring due to Russia's invasion of Ukraine. The soy crop, hit by drought earlier in the year, is estimated at 40 million to 42 million tonnes.

The funds raised from the tax hike will be used to subsidise food production in Argentina, particularly wheat flour, which is used to make bread and pasta, Matias Kulfas, the country's production minister, said on Monday.

"We will put the resources into a trust whose main objective will be to subsidise the price of flour in the domestic market to maintain the prices seen in February," Kulfas told reporters, citing the Ukraine war's impact on inflation.

CIARA-CEC, the country's chamber of grains exporters and processors, has strongly criticised the tax increase, saying it threatens the industry and that it was "analysing all legal avenues" to take against the measure.

Source: Reuters

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