Wheat prices are soaring as the Ukraine war sparks a global food crisis. But in Argentina, one of the world’s agriculture powerhouses, farmer Aimar Dimo is cutting back the acreage he devotes to the crop.
“As a producer, I feel responsible . . . my work should be oriented towards helping the crisis,” said Dimo, who farms 1,500 hectares in Rufino in the northeastern province of Santa Fe. But “at a time when we should be selling to the world because it needs us more than ever, we have no confidence or incentive”.
Argentina produced a record 21.8mn tonnes of wheat last year, compared with
25mn tonnes grown in Ukraine. But despite a pledge by President Alberto Fernåndez last month that the country would seize the “formidable” opportunity to meet demand, its farmers say they are facing a series of deterrents as the May to August planting season is under way.
Chief among them is a strict export quota that Fernåndez’s leftwing Peronist administration further reduced in March to shore up domestic supplies — a move farmers say runs counter to his pronouncement last month. “Instead of our government stimulating production to make things easier for us, they intervene,” said Hugo Ghio, who farms wheat near the city of C6rdoba.
The cost of inputs such as fuel and fertilizer has also risen steeply as the war hits supplies and inflation soars in Argentina’s stuttering economy. Meanwhile, the government recently indicated it was considering increasing the 12 percent tax levied on wheat exports and potentially introducing a new “unexpected profit” tax on companies that analysts say would hit commodity exporters such as farmers.
Under Argentina’s export curbs, just 10mn tonnes of the 2022-23 wheat crop can be sent overseas, down from 14-5mn tonnes in 2021-22.