The producers’ association assured that 25% more must be produced to cover the costs of 2022 for the price of the dollar.
The Board of Directors of the Rural Federation conveyed its concern about the exchange rate to the president of the Central Bank of Uruguay (BCU), Diego Labatensuring that producers will have to produce 25% more to cover the costs of 2022as a consequence of the price of the dollar, as reported by tardáguila.
The president of the Rural Federation, Jorge Andres Rodriguezstressed the idea that producers are not served by a low exchange rateand assured that he believes that the drop in state revenues due to the drought will be offset by a fiscal adjustment, in the framework of a meeting last Monday.
However, Rodríguez said that from the rural union “We applaud the drop in inflation and the free fluctuation of the dollar”, a task that was entrusted to the BCU. From the Rural Federation they insisted that a low exchange rate is a double shock for the sector, if one takes into account the historical drought that devastates the countryside.
“We came to show our faces, even knowing that they were not going to receive us with cookies”pointed out something humorous Labat, who arrived at the meeting with the rural union accompanied by part of the BCU board team.
The Rural Federation is pessimistic regarding the price of the dollar
On the other hand, Rodríguez commented that the scenario proposed by the Central for the next 24 months is one where the exchange ratea priori, it would not fall as it has been doing in the last 12 months.
However, from the union they are pessimistic because, despite the fact that there are no new setbacks, nor does it seem that there will be a significant recovery in the price of the US currency.
According to Rodríguez, the joint impact of the drought and a low exchange rate is more serious for SMEs that have a cost structure based on consumer goods.
Source: Ambito
