While there is a small improvement in the Producer Confidence Index, this is due to the five-year forward outlook. The September report states that “the present conditions and the expectations for the 2022/23 campaign present complex situations, both from the climatic point of view and from the political and economic point of view”.
“Likewise, 71% of producers do not plan to invest in the next 12 months, justifying this negative behavior in the possible risks implied by political and economic uncertainty, the absence of financing with high interest rates and the risks inherent to the sector” , indicated the study. They also added that there are no attractive projects that encourage investment in the short term.
Another factor that contributes negativity is the weather, since significant losses are expected in wheat production -in some cases irreversible- and an impact on the sowing of the thick crop.
59% of producers fear severe weather problems ahead, “and they think that changes should be made in the productive approaches so that they are in accordance with said climatic contingencies”, they said from the university.
Despite everything, the report reveals that the drop would be offset by a small increase in the production of sunflower soybeans. However, the forecast of the fall in the planted area and the total production may be higher if the climatic conditions do not show changes.
Soybean dollar: what producers expect
In this edition, a separate segment on the soybean dollar is included, where they indicate that “the measure is driven by the desperate situation of the Central Bank’s reserves, ultimately dealing with income that will be lacking in the coming months,” says the report. .
In the short term, expectations do not change since the implementation of the soybean dollar is seen as “barely a patch” and not as a structural measure aimed at correcting the delayed exchange rate (plus withholdings) that seriously affects the competitiveness of the sector.
“A controversial issue was raised about the use of these income by producers and, in the case of our survey, we found that a large part of the funds would be applied to the purchase of inputs and payment of pending accounts or leases; while that only a low percentage of the producers has mentioned the use of the funds for the purchase of the MEP Dollar”, the specialists detail.
Source: Ambito
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