The new government in Argentina is raising export taxes on soybeans to 35 percent, but Soybean and Corn Advisor President Michael Cordonnier still expects Argentina’s farmers to plant more soybeans than corn. “There was a lot of forward contracting to get ahead of the taxes. Now, that’s gone. Farmers are switching some of the corn to soybeans,” says Cordonnier. “The Argentine government increased soybeans 100,000 hectares. The Buenos Aires Grain Exchange lowered their corn acreage 100,000 hectares. That’s a one-to-one switch.” Cordonnier says the switching out of corn into soybeans makes sense. “Soybeans are cheaper to grow, and the Argentine farmers aren’t only worried about the export tax. In the past, the government interfered with corn exports on purpose to drive down the price of corn, hold down feed costs and food inflation,” he says. “Inflation is more than 50 percent in Argentina. There’s fear regarding corn exports. If they can’t export, they’re not going to get the world price. They’re worried about interference in the corn export market.”
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