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Argentina mulls port closures, signalling potential pressure on grain used in cattle feed

27 March 2020

Argentine grains port workers have requested that exports be suspended during the pandemic.

On 26 March, a labour union representing Argentina’s grains port workers asked the government to suspend exports. According to reporting in Reuters, the move would put upward pressure on global soy prices and hobble the country’s principle source of revenue as it tries to avoid default.

The URGARA union, which represents inspectors who verify the quality of grains before they are loaded onto ships, said the COVID-19 pandemic was sufficiently severe to justify suspending port activities.

Argentina is the number one exporter of soymeal livestock feed and the number three supplier of corn and raw soybeans.

"We strongly request that all operations in ports be suspended for 15 days. In the current health emergency, we do not consider most port activities to be essential," URGARA chief Pablo Palacio said in an open letter to Argentine President Alberto Fernandez.

"Foreign trade should be considered only for activities that cannot be postponed, that is, as a true exception to the rule, not as an authorisation to open the door to foreigners from countries considered risky," it said.

The government had no immediate comment on the letter.

Restricting the grains flow from Argentina could shift the world’s commodity trade flows, causing importers to rely on rival suppliers like Brazil or the United States. Grain producers in Argentina’s Pampas farm belt say they are against a port shutdown.

As of 26 March, Argentina reported 502 confirmed cases of coronavirus, with eight deaths.

The pandemic hits at the worst possible time for Argentina, as growers start harvesting this season's crops and the cash-strapped government scrambles to avoid defaulting on more than $100 billion in what it calls "unsustainable" debt.

"We need to take all precautions, but there's no way we can stop exporting. I hope the authorities can find a solution," said Santiago del Solar, a corn and soy farmer in the bread-basket province of Buenos Aires.

"If the government starts to halt cargo ships, soybean prices go up and government tax collection goes down," said fellow Buenos Aires grower David Hughes. "They have to try to convince port workers to keep doing their jobs, while taking necessary precautions."

Read more about this story here.



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