Argentina declares an agro state of emergency

May corn futures (courtesy CBOT)

Yesterday evening Klishtina signed the necessary papers to officially call the situation in Argentina an emergency and give financial breaks to farmers hard hit by the ongoing drought. Thus Argentina joins Uruguay in emergency status. Here is AP with last night's news and a second article dated Jan 23rd that gives good background on the situation.

Finally here's a link to a review of the CBOT corn trading yesterday. Just FYI.

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BUENOS AIRES, Argentina (AP) — Argentina's president declared an agricultural emergency Monday in the nation's breadbasket provinces, responding to a key demand by powerful farm organizations amid the worst drought in decades.

Cristina Fernandez told political and business leaders in a televised press conference that the decree will exempt thousands of farmers from paying various taxes for one year to help them confront what analysts estimate will be $5 billion in losses this yada yada continues here

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STROEDER, Argentina (AP) — Skeletons of livestock are piling up in the scorching sun of the Southern Hemisphere's summer as the worst drought in a generation turns much of Argentina's breadbasket into a dust bowl.

The nation's farm sector stands to lose $5 billion this year alone — a huge blow to the economy of Argentina, a top world exporter of soy, corn, wheat and beef — as well as to the government of President Cristina Fernandez, which faces billions of dollars in debt payments this year.

Wheat fields that once supplied flour for pasta-loving Argentines now resemble deserts, and spiny thistles are all that survive on cattle ranches in southern Buenos Aires province.

Nothing edible grows, said Hilda Schneider, a 65-year-old rancher who has lost nearly 500 cows to starvation.

"With the situation we're in now, without any harvest, there's nothing to do," said Schneider, one of 2,000 residents in Stroeder, a farming village suffering its worst drought since the 1930s. "We try to save the animals, which is the only thing we have left."

Nationally, there hasn't been this little rain in Argentina since 1971, according to yada yada continues here

Argentina: Somebody had to tell 'em

This report in Argentina's La Nacion this weekend was so good I've translated it below. Straight talk about just how badly this government is treating its population. Well said Martin Richenhagen, President and CEO of AGCO.

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Our clients need more support from the Government (of Argentina) and Argentina probably needs another government," said Martin Richenhagen, President and CEO of AGCO, an important multinational manufacturer and distributor of agricultural equipment.

In a country unaccustomed to sincere opinion from businesspeople, the CEO of the world's second largest agromachinery company called on (Argentina's agro) producers to vote for those who defend the agricultural sector and said that his company will not invest in Argentina due to the agro sector problems.

The agro community needs rules and stable policies. It is the only country that does not receive subsidies and must also pay a very high tax in order to export," said Richenhagen. "To export firsy you have to apply for a permit and then they don't give you it," he said exasperated in reference to the permits for exportation.

AGCO (which includes the marques Challenger, Fendt, Massey Ferguson and Valtra) will invest U$250m in factory capex and U$200m in R&D this year. Argentina is not part of its plans.