To a lesser extent, rumors of a possible Chinese invasion of Taiwan also influenced the market. The China Daily newspaper – controlled by the Chinese Communist Party – indicated that a possible visit to Taiwan by the Speaker of the US House of Representatives, Nancy Pelosi, “would constitute a serious challenge to China’s sovereignty and territorial integrity.” The agricultural commodities market is closely following any type of reaction from the Asian giant, which in practice is the world’s largest buyer of soybeans.
In this context, as of today the special regime began to be available in local banks so that producers who sell soybeans until August 31 can convert 30% into the savings dollar. With this measure, the Government seeks to collect an additional US$2.5 billion in the liquidation of foreign currency from the August field, which if this scenario were fulfilled would reach US$4.0 billion.
The truth is that so far As explained by sector analysts, the measure would not have had an impact on the sector that awaits economic definitions by the appointed Minister of Economy, Production and Agriculture, Sergio Massa, who will formally take office on Wednesday. Basically, the field awaits another possible measure that directly promotes the liquidation of the soybean harvest and with which there was speculation during the last weekend.
Along the same lines, the main agro-export companies that have a well-known good relationship with the new minister hope to be called to dialogue in a context in which the Central Bank not only hopes that there will be more sales of soybeans but also that the companies themselves liquidate the dollars to the market with greater dynamism.
Another key fact is that in July, agro-export companies liquidated just over US$3.1 billion, which represents 17% less than in June, and 10% below July 2021. Despite the fact that international prices remained at high levels, lower soybean sales would have had a full impact on the liquidation and that is the story that Sergio Massa’s economic team will seek to reverse in the short term.
So far, around 22 million tons of soybeans remain to be sold from the 2021/22 campaign, valued at around US$14 billion. Those dollars will be key for the Government to obtain some peace of mind in the August-September two-month period, when it is also expected that the demand for foreign exchange for energy imports will fall sharply.
Source: Ambito
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