MercoPress. South Atlantic News Agency

Expropriation project of Argentine giant soymeal exporter is watered down

Soy farmers owed money by Vicentin could become shareholders in the oncemighty company which went broke after going on a credit-fueled expansion last year

Argentina is examining alternatives to the planned expropriation of financially ailing soymeal exporter Vicentin, including a possible private-public partnership, Production Minister Matias Kulfas and other sources revealed on Wednesday.

 Soy farmers owed money by Vicentin could end up as shareholders in the once-mighty company, which went broke after going on a credit-fueled expansion last year.

Kulfas said the government was analyzing alternatives to the expropriation plan announced by President Alberto Fernandez at the start of June.

“We have proposed different models ... but without expropriation,” Kuflas said in a video conference with the Wilson Center think-tank. The idea, he said, was to create “a mixed” private-public company.

Argentina is the top international supplier of soy oil and soy meal livestock feed.

Fernandez had said the government would “intervene” in Vicentin, once Argentina's No. 1 exporter of soy byproducts, while his administration sought congressional approval for a full takeover of the company.

That plan was put on pause after the government of Santa Fe province, where Vicentin is based, offered to lead the intervention in the company.

Presidential adviser Gabriel Delgado told reporters the state was the final guarantor for maintaining employment and the export sector's health as the country struggles with a recession compounded by the coronavirus pandemic.

“The state is looking at all alternatives that would guarantee the recovery of the company. The market in six months did not find a solution and now we are working to solve this problem of employment and production at a very difficult time for the economy,” Delgado said.

“The state is using a set of exceptional tools to deal with an exceptional situation,” he added, addressing worries among farmers and export industry officials that the government was using Vicentin to gain a foothold in the key grains sector.

Late on Wednesday evening the Argentine Senate decided by simple majority to name a bicameral commission to check on the Vicentín group debts with government banks. Opposition rejected the initiative arguing that the House rules demand a special two thirds majority for such a commission and not the 41 to 29 approval.

The initiative was presented by Cristina Fernandez grouping, led by Senator Parrilli, while the opposition was centered in the followers of former president Mauricio Macri. Apparently the Vicentín group obtained 1,8 billion in Argentine Pesos from government banks.