Journalist: How is the year 2023 coming?
-A different game will be played than in 2022. First of all, there is no space to advance income for 2024, the soybean dollar has run out, since there are few merchandise left on the market, there is a drought that will significantly reduce the harvest of soybeans and corn (it already happened with wheat), and inflation will continue to weigh on the Argentine economy.
Q.: How do you see inflation?
-Entrepreneurs will have to live with inflation of more than 100% per year. This implies a fall in real wages. In this context, it is necessary to work on a larger scale, reduce margins, increase turnover, continue with the aggressive policy of financing at negative rates of 65% per year with productive investment credits, and manage surplus temporary funds very well so as not to leave them immobilized. on the banks.
Q.: Is it necessary to be more awake?
-Correct, we have to try not to immobilize the stock, rotate with less margin and try to have the business room always active.
Q.: How did you see the collection?
-Do not look at what happened in December, because everything is distorted by the collection of the soybean dollar. If you look at the annual collection, it rose 81.6%, much less than inflation. This implies that, although inflation liquefies expenses, it threatens a good tax collection, something that is often ignored. In the year the consumption VAT rose 81.6%, which speaks of the fall in real wages. There are fewer checks on the street, since check tax collection rose 79.0% and the social security system showed an annual increase of 80%, wages clearly lag behind inflation.
Q.: How do you see the field?
-The soybean dollar ended, a lot of merchandise was sold and it is now difficult to capture dollars from the sale of this product. With the two programs, US$10.800 million were obtained, it is what saved Sergio Massa, if the soybean dollar had not existed, he would not have met the fiscal, monetary and exchange goals with the IMF.
Q.: Will another soybean dollar come?
-I don’t think so, because there is very little merchandise left and in the next campaign less than 40 million tons will be harvested, which the producer will sell quickly because the field is empty.
Q.: How will you activate the income of dollars?
-Difficult because there is little wheat and corn on the market, with which, on the agricultural side, there is no possible path.
Q.: Meat dollar?
-It is probable, the government is evaluating a meat dollar at $230. In Argentina we produce some 3.1 million tons of meat, of that total, 2.2 million tons go to the domestic market and 900,000 tons go to the foreign market. The cattle stock is high and exports could be increased without entering into a process of liquidation of wombs.
Q.: What cannot be avoided is the rise in prices…
-The farmer is losing a lot of money, the calf has a price of more than $400 per kilo, corn is worth $47 per kilo and fat for consumption is worth $330, it is an equation that is leading to the closure of numerous feedlot establishments. If there is no meat dollar at $230 and exports are boosted, the sector is in the oven.
Q.: Would that generate more inflation?
-It is probable, but it would save many sources of work, since beef is the one that energizes the market for pork, chicken and many derivatives. Sergio Massa is not convinced, but necessity has the face of a heretic.
Q.: How do you see the dollar scenario?
-The problem in Argentina is that there is no news that indicates that the government will reduce the fiscal deficit. Therefore, it becomes news how to finance the fiscal deficit. Today a debt exchange in pesos for the first quarter will take place, a total of $4.2 million matures, of which 50% is in the hands of the State. It will be interesting to see who redeems, and much more interesting who chooses the bond in pesos maturing in February 2024, since that title would expire after the elections.
Q.: You didn’t answer my question
I’m going to answer you as always. Reserves will begin to move closer to $40 billion when the government pays interest on dollar sovereign bonds on January 9, and pays January maturities to the IMF. Monetary liabilities are headed for $16 trillion, so we continue to see alternative dollars headed for $400.
Q.: What did you see about the exchange market?
-The Central Bank, in the last 12 months, collected exports and paid imports (perceived), which left a balance of US$19,719 million. The balance of the trade balance reported by INDEC for the last 12 months (accrued) is US$6,115 million, in this difference there are freight charges, but also postponement of import payments for approximately US$10,000 million, for Therefore, the reserves of the Central Bank are under permanent stress, they add up to US$44,606 million, but well measured, they do not reach US$5,000 million and if we deduct the pending imports, they are negative again.
Q.: How do you see the international scene?
-Very good for China since the yuan is trading below 7 yuan per dollar, that could improve the prices of meat and grains. I am concerned about Brazil, the real ended yesterday above 5.30 to the dollar, and if it exceeds 5.50 to the dollar, beware, we could see a real above 6.0 to the dollar. The measures announced by President Lula do not give confidence to the market. The next meeting of the Federal Reserve is on January 31 and February 1. There is nothing to suggest that they will loosen the policy of raising rates, with which it is necessary to prepare for a short-term rate of around 5.0% per year, with an inverted longer-dated bond curve, this is recessionary for the economy, and not good news for the capital market.
Q.: Shall we close with Argentina?
-In the month of June there is a closing of the lists, with which in May we will have the candidates for president, the second Sunday of August the PASO elections, the third Sunday of October the presidential elections, and if there is no winner in the first round, in 4 weeks we have the second round between the two most voted. As of today, there is no certainty of who will be the candidates for president of the majority parties, the presidential election is generally defined in the last three months, with which we will have an orientation in mid-May 2023.
Q.: Is there a long way to go?
-We are coming from a bullish rally in shares, it is likely that the market will have to digest the rise in recent months, we will have international rate rises, and the Argentine drought will not allow the country to show better public accounts and a greater activity level
Q.: What do you want to tell me?
-We are more for profit taking than for a sustained growth in prices.
Q.: How do you see the Central Bank?
-The month of December started pretending that the official dollar will rise by around 7.0% per month, I think that the rise will fade away and that it will only rise 6.0% in the month. Alternative dollars will continue to rise. The tourist dollar would end the month around $380, so it would not be unusual for alternative dollars to end up reaching or passing it.
Q.: Any additional details?
–In the next note we will talk about inflation in December and the interest rate. To expand the information you have the private reports, consult prices, they are daily and it is information by exception.
Source: Ambito
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