MercoPress. South Atlantic News Agency

Argentine “soy king”: export duties makes farming “non viable”

Farmer Gustavo Grobocopatel

Argentina's “Soy King”, Gustavo Grobocopatel warned that if export taxes remain averaging 35%, and commodities don't recover prices of early 2008, next year many people will be going bankrupt because with current costs oilseeds production “is not viable”.

"As the income-costs equation is currently structured, all farm production in Argentina becomes non viable" said Grobocopatel, Argentina's main producer of soy beans who lately has had some experiences in Brazil. Grobocopatel said farmers are inside a straight jacket of sliding export taxes but "there's no system established" and warned that the current level of levies makes it impossible to keep producing at current costs. But he also pointed out that "the farm production machine should be the first to react" when an international crisis because when markets receive plenty of oxygen again, demand for commodities will begin to increase again". "The current system of export levies has become a distorting tax because it tends to concentrates wealth in those who are doing better and punishes those who are having a rough time". He added that these perturbing factors must be removed because if we can't agree we're going to have in Argentina unnecessary situations". However the good news is not that soy beans price has increased "but rather that we have soy. The world is demanding soy beans and Argentina is in a privileged position plus being highly competitive", he concluded.