Argentina Lifts Export Restrictions
- The agriculture ministry has lifted a 30,000 tonne per day limit recently placed on corn exports.
- The limit was intended to replace a complete ban on corn exports through February.
- The government said the curb was intended to ensure domestic food supplies and stable prices for corn users.
- Farmers started a sales strike on Monday to protest the ban, and kept it up as the cap was put in place.
- Argentina's three main growers' organizations called off the strike after negotiations with the ag ministry.
- The government agreed to cease the daily export limit and formed a commission to monitor domestic corn prices.
FBN’s Take On What It Means: There was always a question as to whether an export ban or even limit could work in Argentina, as the country remains dependent on ag exports to support its economy. The three day strike had no effect on Argentina’s exports, which are expected to continue on pace. However, the situation does point up the current tightness in supplies and that there is little room for declines in production for the new crop.
Russia Proposes Export Tax For Wheat, Barley, and Corn
- Russia’s agriculture ministry confirmed rumors that it is considering raising the wheat export tax with the current proposal at 45 euros per tonne, up from the current level at 25 euros.
- The current tax is set to start February 15 with the higher proposed tax set to start March 15, if approved.
- The ministry also proposed a barley export tax at 10 euros per tonne and a corn export tax at 25 euros per tonne.
- The new proposals are scheduled to be reviewed on January 15.
- Russia is the world’s largest wheat exporter and second largest barley exporter, following behind the EU.
- The current wheat export hike appears to have not been sufficient enough to discourage domestic prices from rising.
FBN’s Take On What It Means: These proposals, if approved, will benefit other wheat export origins. Likely, the outcome will again be higher FOB values as countries continue to need to source feed grains and food grains. Russia’s rising domestic prices are not a result of tight domestic supplies but rather a result of rising global demand.
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