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November 12, 2020 | FBN Insights | Kevin McNew

Argentine Port Workers Continue Strike

Loading of five cargo ships in three different grain ports in Argentina has been stalled for days

File Photo

Argentine Port Workers Strike

  • The loading of five cargo ships in three different grain ports in Argentina has been stalled for days due to strikes by port workers.
  • URGARA, which represents grain inspectors, launched surprise strikes to protest stalled wage talks.
  • The striking workers have organized complete work stoppages in some cases and are refusing to work overtime.
  • Export companies and port workers are still far from reaching a salary agreement according to representatives.
  • Argentina is the world's largest exporter of soy meal and grains are the country's primary source of much-needed foreign trade.
  • Previous strikes have been stopped by government intervention in a day or less.

FBN’s Take On What It Means: Protests and strikes are common in Argentina's agricultural export sector. This work action comes at a time when there is less grain flow to ports due to the planting cycle, but interruptions have contributed to higher meal premiums which in turn support bean prices. Given the importance of agricultural exports in Argentina, it’s likely the government will again step in to compel workers back on the job if no settlement is reached. 

China Soy Crush Steady

  • Chinese soy crush for the week ended Nov 6 was about unchanged from the previous week at just under 2.1 million tonnes.
  • This week’s crush is up 35% from 1.6 million tonnes last year and capacity utilization remains just below 60%.
  • Total soy crush for the season to date is 10.4 million tonnes compared to 8.5 million last year.
  • Stocks of soybeans in ports increased 168,000 tonnes during the week to just under 6 million tonnes and up from 3.2 mmt a year ago. 
  • Meal stocks fell slightly from last week to 842,000 tonnes versus 412,000 at the same time last year. 
  • Crush margins in China remain strongly positive and near the highest in the last four years.

FBN’s Take On What It Means : Based on large commitments for soybeans, crush in China is expected to remain above 2 million tonnes for the next several weeks. While demand for meal is still strong, building port stocks of beans have led to a slower buying pace recently. However, as long as crush margins stay high, demand for beans should be supported. 

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