Friday, May 9, 2008

Food Politics: Argentina--Back on Strike

Yesterday MercoPress had this story which was bad enough:

Half of Argentine 2007/08 crop retained in the farms

The extended Argentine farmers/government conflict, which was triggered in early March when the new sliding export taxes system was announced, and its renewed eight days of protest, have left an estimated 44 million tons of grains and oil seeds unsold, valued in approximately 12 billion US dollars, according to market analysts interviewed by the Buenos Aires press....MORE

Today the International Political Economy Zone blog tells us:

Call it populism that isn't particularly, well, po-pu-lar. While India has decided to shut down futures trading of in-demand agricultural commodities to show the public it is "doing something" about the high prices of food at home, the Peronist government of Argentinian President Cristina Fernandez de Kirchner has raised export tariffs in a bid to keep the locals well-supplied with increasingly scarce agricultural produce. The problem is that the farmers whose livelihoods have been adversely affected by this tariff are none to happy, as are many middle class folks who Kirchner needs the support of. The decision to raise tariffs was accompanied by massive rioting in Argentina by affected farmers. As is usually the case in Argentina, large-scale disturbances ensued. In this instance, routes were cut off to neighbouring countries which are usually destinations of Argentinean produce until the elevated tariffs were put into effect. If you want more of a background, consult this TIME article, from which I draw the snippet below:...

...A 30-day truce ended at the start of the month. With more than half of all export revenues coming from agricultural exports which are now at a standstill, things aren't looking up for Argentina's economy. The main agricultural producers in the country want nothing less than the removal of the additional tariffs, but Kirchner won't back down from the redistributive ploy. The result is that the farmers have gone back to good ol' "industrial action," as per the British euphemism. From Reuters:...