Argentina fertilizer sales fall on farm dispute

08 July 2008 22:53  [Source: ICIS news]

BUENOS AIRES (ICIS news)--Fertilizer producers in Argentina are seeing their sales fall due to a export tax dispute between the government and farmers and its impact on agricultural production, a source said on Tuesday.

The long-running disagreement between the government and farmers has continued while the Senate considers a resolution to ratify an increase in export taxes on agricultural products.

The tax ignited protests by farmers earlier this year.

Industry sources predicted a 25% reduction of the wheat harvest this year.

The decrease in wheat planting is already affecting the agrochemical sales.

“There’s a reduction in the amount of wheat cultivated, especially in the North of Buenos Aires province”, Roberto Coronel of the Federation of Distributors of Agricultural Raw Materials (FEDIA) said in Spanish.

Only 36.9% of the area to be harvested has been sown, compared with 55% at this time last year.

The Agriculture, Cattle Ranching, Fishing and Foods Secretary (SAGPyA) June report estimates that the cultivated area for wheat in Argentina, for the harvest of 2007-08, was of 5.8m hectares.

The president of FEDIA said that “fertilizer sales will be diminished but surely the area not sown with wheat will be cultivated with another grain like soy or corn, which requires less fertilizer than wheat”.

Pablo Bertone, head of the Chamber of Distributors of Agrochemicals, Seeds and similar products of the province of Cordoba (CEDASAC) said the region saw a 15% drop in fertilizer sales during the first half of 2008, compared with the same period in 2007.

Marcelo Sorazana, agricultural engineer for fertilizer firm Hector Bertone, indicated that “sales destined for wheat crops have fallen between 10% and 20%, while sales for corn plantations haven’t even started yet, which is unusual for this time of the year”.

On top of the export tax issue, the region is experiencing a drought, which is contributing to the drop in fertilizer sales.

The rainfall average for this time of the year diminished by 50% compared with 2007, according to a source.

The farm sector has led a series of strikes in the last three-and-a-half months to protest the export tax measure imposed by the government on 11 March.

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By: Cristina Kroll
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