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By Eliana Raszewski
BUENOS AIRES, Nov 25 (Reuters) – Argentina will reestablish a preferential currency exchange for soybean exports until the end of the year, economy ministry sources said on Friday, looking to rev up exports of its top cash crop and bring in much-needed dollars.
The government, which spurred huge soy exports in September with the so-called “soy dollar” rate, has agreed a “floor” of some $3 billion in exports with grains firms, the source added. A second government source confirmed the special measure for soybean sales.
Argentina is the world’s top exporter of processed soy oil and meal, but high inflation and tight capital controls have at times led farmers to hold onto their crops as a hedge against the local currency devaluing.
Argentina’s central bank is looking to bolster its international currency reserves, which have fallen sharply due to uncertainty regarding the local peso currency amid high inflation and financial difficulties.
During September, the central bank granted grains exporters 200 pesos for every dollar settled, considerably higher than the then official rate of around 150 pesos per dollar. The official rate is now 165 pesos.
“The September soybean dollar is reopened with an inflation update,” the source said about the measure, which will run from next Monday until Dec. 31.
“The government’s agreement with the grain companies (farm export firms) has a guaranteed and signed floor of $3 billion,” the source said.
The measure in September spurred almost $8 billion to enter the country, of which around $5 billion remained as central bank reserves.
“It is highly like that (a new edition of the ‘soybean dollar’) would be from Monday, Nov. 28 until Dec. 31,” one source from the agro-export sector told Reuters.
None of the sources indicated what the exchange rate offered to producers would be, although they said government authorities would meet with the agro-export and productive sectors later on Friday to explain more details.
“They notified us today so we could be in the announcement (…) but we do not agree with this ‘soybean dollar,’ Carlos Achetoni, president of the Argentine Agrarian Federation, one of the main rural associations in the country, told Reuters, adding he will not attend the meeting.
“You have to look for a single (exchange) parity,” he said.
(Reporting by Eliana Raszewski; Writing by Adam Jourdan; Editing by Daniel Wallis and Josie Kao)
((adam.jourdan@thomsonreuters.com; +54 1155446882; Reuters Messaging: adam.jourdan.thomsonreuters.com@reuters.net))
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