Argentine farmers increase corn investment

Argentine farmers will increase investments in the next corn planting season despite fears about a political comeback for former President Cristina Fernandez, who implemented export taxes and restrictions despised by the sector, according to Reuters’ report.

 

Several polls show Fernandez in the lead for a Senate seat in politically crucial Buenos Aires province in October's legislative election, which could determine the future of President Mauricio Macri's free-market agenda. A primary vote will take place on Sunday.

 

Sales of fertilizer will grow to 3.9 million tonnes in 2017, up 8 percent from the prior year, according to Fertilizar, an agrochemical industry group. Farmers have also stepped up purchases of advanced-technology corn seeds, according to Argentina's ASA seed producers association.

 

"We're all watching the elections, but agricultural producers already see that the commercial conditions have changed," said Alfredo Paseyro, ASA's general manager.

 

Since taking office in late 2015, Macri has eliminated export taxes and restrictions on corn and wheat, leading to record-high harvests. Fernandez clashed with the economically key agriculture sector over her interventionist policies during her two terms in office from 2007-2015.

 

The specter of her political return has spooked investors. But that has had little impact on farmers, who are banking on policy stability at least through next year's harvest.

 

Planting for the 2017/18 crop starts in September, with harvests beginning in March.

 

"When they harvest corn, this government will still be in power, so it's not a risky investment in the political sense," said political analyst Raul Aragon.

 

According to the Buenos Aires grains exchange, public policies favorable to the agricultural sector helped boost the 2016/17 crop to a record-high 39 million tonnes, above the previous volume of 30 million tonnes.

 

Corn "needed a push, some condition to improve the equation," said Maria Fernandez Gonzalez Sanjuan, Fertilizar's executive manager.