Argentine Farmers Protest Strike

We are closely watching this issue, and so have decided to group all the articles in a special section to make it easy to follow.

May 8, 2008 -- Argentine farmers began their second national strike in as many months by blocking grain exports and withholding crops to protest tax increases and price caps on domestic food.

An eight-day strike was called yesterday after government talks collapsed, and farmers began to stop trucks on highways across the country last night. Alfredo De Angeli, a farmer who was among the leaders of a three-week protest in March, urged President Cristina Fernandez de Kirchner to intervene.

"We're not going to back down,'' De Angeli told protesters at a rally held on a highway linking Argentina with Brazil. "If the president wants us to be here more days, we will be here,'' De Angeli said in comments broadcast on local television.

The protests threaten to deepen a global food shortage and hurt South America's second-biggest economy. Argentina, the world's second-largest corn exporter and No. 3 in soybeans, relies on agriculture for more than half of its export earnings. The government imposed the export taxes and food-price caps to combat domestic inflation.

'Extortion'
Cabinet Chief Alberto Fernandez, who led the government's talks with farm-group leaders, refused to continue the meetings yesterday after saying the threats to disrupt grain shipments amounted to "extortion.'' Farmers in Cordoba and Entre Rios provinces gathered on highways and impeded access to trucks carrying corn and soybeans hours after his comments.

Pablo Moyano, the head of Argentina's truck drivers union, said his members won't let farmers selectively block the roads.

"Everyone passes or no one passes,'' Moyano told state-run newswire Telam last night.

Ariel Onguino, 46, vice president of El Aguilucho SA, a truck company based in Rosario, said revenue has fallen 40 percent since March and he may lay off some of the company's 250 employees.

The strike is "irresponsible,'' Argentina's Interior Minister Florencio Randazzo said in comments made to Radio Mitre. "All they want to do is defend their own interest instead of thinking of the general public,'' he said.

Cronica Television channel showed farmers taking dozens of tractors and trucks to downtown Mar del Plata city in Buenos Aires province to protest. Some demonstrators held signs saying: "They are lying to you, farmers are on your side.''

Missed Opportunity
By going on strike, farmers lost a chance yesterday to end the dispute, Agriculture Secretary Javier de Urquiza said earlier today in an interview with Buenos Aires-based Radio 10. The government was willing to reach an accord, while farmers were only interested in discussing the export tax, he said.

"The way this affair has been handled by the government, along with high inflation, should continue to weigh negatively on the government's popularity,'' Bertrand Delgado, a Latin America economist for IDEAglobal, a New York-based research firm, said in an e-mailed note yesterday.

Public approval of Fernandez's performance dropped to 29 percent from 35 percent in March, Buenos Aires-based polling company Graciela Romer & Associates said May 6.

The government blames accelerating inflation on the farmers' strike that emptied supermarket shelves before ending April 2, said Sergio Berensztein, a Buenos Aires political analyst at pollster Poliarquia Consultores.

Inflation Accelerates

Consumer prices rose 8.8 percent in March from a year earlier, according to the government. Some economists dispute the figure. Annual inflation probably was 22 percent to 23 percent, according to Alexandre Schwartsman, the chief economist for Latin America at ABN Amro in Sao Paulo.

"There was no agreement because one side of the table wasn't interested in reaching an accord,'' Berensztein said. ``The government is far more comfortable with confrontation and creating an enemy in the eyes of the people.''

The risk of owning Argentine bonds neared the highest since June 22, 2005, according to Bloomberg data. Five-year credit default swaps based on the country's debt increased 8 basis points to 6.20 percentage points. That means it costs $620,000 to protect $10 million of the country's debt from default.

Credit-default swaps, contracts conceived to protect bondholders against default, pay the buyer face value in exchange for the underlying securities or the cash equivalent should a borrower fail to adhere to its debt agreements.

Bonds, Stocks
The yield on Argentina's benchmark 8.28 percent bond maturing in 2033 fell 11.7 basis points, or 0.117 percentage point, to 10.374 percent at 3.08 p.m. New York time, according to composite data compiled by Bloomberg. The price rose 0.93 to 80.21.

Argentina's Merval index fell 0.5 percent to 2,084.54 after losing 1.6 percent yesterday. Cresud SACIF y A, which rents Argentine farmland and raises cattle, fell 2 centavos, or 0.4 percent, to 5.10 pesos, following a 3 percent drop yesterday, the biggest loss since March 19.

Farmers want the government to modify a variable export tax introduced almost two months ago. The tax levies soybeans and sunflower seeds at more than 40 percent, depending on prices, compared with a previous fixed rate of 35 percent.

Export taxes, which include levies on agricultural goods as well as fuels, more than doubled to 1.5 billion pesos ($471 million) in April from a year earlier, the government reported May 5. Export taxes accounted for about 15 percent of government tax revenue last month.

Growth Outlook
Victoria Saddi, a Latin America economist with RGE Monitor in New York, said she's cutting her forecast for Argentine economic growth this year to 6.8 percent from 8.9 percent.

"I don't think the strike is going to be over very soon and exports are an important part of economic growth in Argentina,'' Saddi said in a telephone interview.

Economy Minister Martin Lousteau resigned April 24 as farmers protests caused food shortages and halted grain exports, prompting the biggest anti-government demonstrations since 2001.

Soybean futures for July delivery rose 3 cents, or 0.2 percent, to $13.12 a bushel on the Chicago Board of Trade. The price has surged 80 percent in the past year.

"Sounds to me like the Argentine government is still taking a hard line and that farmers are unlikely to be mollified,'' said Anne Frick, a senior oilseed analyst for Prudential Financial in New York. "The market's response is surprisingly tepid, in my view, given what looks to me like the increased likelihood of some export impediments.''

Withholding Supply
Supplies to exporters fell 50 percent last month as farmers withheld their soybean and corn harvests on expectation of a change in the tax, Cesar Gagliardo, president of Buenos Aires grains brokerage Artegran SA, said in an interview yesterday.

April 29, 2008 -- Venezuela's benchmark dollar bonds had their biggest gain in two weeks on speculation the government may use some proceeds from a debt sale to repurchase outstanding securities.

The yield on Venezuela's benchmark 9 1/4 percent bonds maturing in 2027 fell 19 basis points, or 0.19 percentage point, to 10.22 percent at 4:25 p.m. in New York, according to JPMorgan Chase & Co. The bonds' price climbed 1.45 cents on the dollar, the most since April 10, to 91.85 cents.

Venezuela sold $4 billion of bonds maturing in 2023 and 2028 to local investors last week. The government said it plans to use proceeds to refinance debt.

"Investors began believing the government will be buying bonds back with the resources,'' said Gianfranco Bertozzi, an economist at Lehman Brothers Holdings Inc. in New York. "There might have been doubts before. They are serious about buying back bonds.''

The risk of owning Venezuelan bonds fell the most since Aug. 16, according to Bloomberg data. Five-year credit default swaps based on the country's debt declined 10 basis points to 617 basis points. That means it costs $617,000 to protect $10 million of the country's debt from default.

The extra yield investors demand to own Venezuelan bonds rather than U.S. Treasuries narrowed 18 basis points, the most in emerging markets, to 6.20 percentage points. The so-called spread on emerging market debt shrank 2 basis points to 2.63 percentage points.

Farmers' Strike
The yield spread on Argentine bonds remained near the widest since June 2005 on concern farmers won't reach an agreement with the government to avert a strike. The spread on Argentine bonds widened 2 basis points to 5.82 percentage points.

Farmers have set a May 2 deadline to reach an accord with President Cristina Fernandez de Kirchner's government. Last month, farmers carried out a nationwide work stoppage for three weeks to protest an increase in export taxes, triggering food shortages and adding to a pickup in inflation.

April 27, 2008 -- When the government decided in March to raise taxes on farmers’ profits, it set off a rural revolt in Argentina. For three weeks enraged farmers blocked roads nationwide, paralyzing grain and meat sales and causing food shortages.

Since then, the government has been trying to quell Argentina’s restive farmers at the negotiating table. But farmers like Marcelo and Pablo Marchetti, brothers in this country’s lush grain belt west of the capital, say the talks are going nowhere and are yet more proof that President Cristina Fernández de Kirchner, in office just four months, does not understand them.

They are preparing to resume crippling strikes of grain exports once the deadline for the talks expires on Friday. Some farmers have already spontaneously put up roadblocks in recent days.

“They don’t want to listen to us,” said Pablo Marchetti, 40, whose Italian great-grandfather founded this town of 1,500 a century ago. “In the short term, I just don’t see them finding a logical solution to this whole problem.”

The farmers say they are concerned not only about profits, though the steeper taxes have cut into them. They also say Mrs. Kirchner’s policies are threatening to reverse one of the great agricultural booms in Argentina’s history and to snuff out a technological and entrepreneurial revolution that has made the country a leading food source in a world racked by hunger and rising food prices.

“We have an enormous historic opportunity to grow as a country, but the government wants to punish a sector that should continue to be an engine of growth,” said Marcelo Marchetti, 39. “The world has opened its doors to us, and here we are fighting among ourselves.”

Tensions with the farmers exploded with unusual ferocity here, farmers say, in part because the new taxes touched a nerve in a nation where past governments used the farm sector to redistribute wealth to the poor.

Mrs. Kirchner’s politics have stirred memories of Gen. Juan Domingo Perón, who in the early 1950s used profits from agricultural exports to industrialize the country and lift the poor. Trying to check inflation that independent economists put at close to 20 percent, Mrs. Kirchner, too, turned to farm profits and export controls, looking to increase subsidies for the poor and food supplies at home.

Farmer discontent had been growing since at least 2006, when Néstor Kirchner, her husband and predecessor as president, limited beef exports to ensure a cheap supply at home. Once a dominant meat supplier, Argentina has watched as Brazil has passed it by, building the world’s largest beef export industry. Last year, even their tiny neighbor Uruguay exported more beef per capita than Argentina.

Rural angst reached a boiling point in early March when the government increased export tariffs for the second time since October. The policies have also set de facto ceilings on prices.

Mrs. Kirchner has criticized Argentine farmers as focusing too much on cash crops like soybeans at the expense of products needed for Argentine consumption, like dairy and meat. Soy exports have grown by 263 percent since 1997, to 11.5 million tons last year. She cast the farmers as greedy oligarchs in 4-by-4 vehicles, and as unpatriotic plotters intent on overthrowing the government.

Just days after the latest export measures took hold, the farmers mobilized. Using Web sites, cellphones and satellite dishes, they formed a communications network linking farms of all sizes in a joint stand against the government.

Since both sides agreed to hold talks, the government has refused to back down on the export tariffs and has hardened its stance against the farmers. After promising in mid-April to lift a ban on beef exports, the government decided last week to keep it.

It also canceled a meeting to discuss the wheat sector, making any chance of lifting a ban on those exports seem increasingly unlikely. And it threatened to impose sanctions on farmers if they failed to satisfy domestic demand.

Press officers for the economy minister, who resigned Thursday, and for the interior commerce secretary did not respond to numerous requests for interviews made over the past two weeks. Miguel Nuñez, the president’s chief spokesman, also did not respond to interview requests.

Daniel Kerner, an analyst with Eurasia Group, a consulting firm, said the rigidity of the government’s position is rooted in its need to “regain its political standing and avoid looking weak.”

But opinion polls suggest Mrs. Kirchner’s uncompromising line on the farm revolt has damaged her popularity. She is making the political gamble that the farmers will not be able to mount strikes with the intensity and unity they managed before, analysts said.

Polls have shown that voters, especially in the cities, will not tolerate food shortages or significant increases in food prices.

But where Mrs. Kirchner’s government sees political survival, the Marchetti brothers see a potentially lost opportunity for the country to prosper from a historic boom in commodity prices.

Agriculture has a storied place in Argentine history. A surge in meat and grain exports in the 1880s helped the country’s leaders build the European-style city of Buenos Aires and briefly catapulted Argentina among the 10 richest countries in the world.

Fifteen years ago, the Marchettis began farming here in Córdoba, the country’s second most important province for agriculture. Argentina was just opening to foreign investment, its currency pegged to the dollar, and it quickly became among the more competitive agricultural producers in the world.

Today, with prices for soybeans, corn and wheat at or near record highs, “this was Argentina’s time to feed the world,” said Dan Basse, president of AgResource Company, an agricultural consultancy in Chicago.

But the conflict over export taxes has bred uncertainty about Argentina, Mr. Basse said, and international grain companies have already signaled their preference to pour more money into neighboring Brazil, another agricultural juggernaut where farm policies have been clearer and more encouraging. Both are considered critical to global efforts to fill the soaring demand for soybeans in China and India.

In Argentina’s sprawling rural provinces, the standoff has also sown seeds of doubt and weakened the Peronists. Governors have found themselves torn between supporting Mrs. Kirchner and their farm constituents.

An emergency law passed in 2002, in the midst of an economic crisis, has allowed the Kirchner government to create export taxes and keep the revenues away from governors and mayors. The Kirchners have used the doling out of those revenues to maintain political control over the provinces, which were critical to Mrs. Kirchner’s election.

But lately some governors have fought back, none more so than Juan Schiaretti, Córdoba’s governor and a Peronist, who won the election because of rural support. In a brief interview, Mr. Schiaretti confirmed that the farm conflict had created tensions between him and the national government.

Mr. Schiaretti has pushed for more of what lawmakers call “co-participation” funds to ensure the provinces get a bigger share of farm revenues. Carlos Gutierrez, Córdoba’s agriculture minister, said that only 10 percent of the tariffs on soy flows back to the province for infrastructure and other projects; the rest stays in Buenos Aires with the national government.

In Wenceslao Escalante, the Marchetti brothers, who both studied accounting in college, said the government’s policies were killing their incentives to produce more. A decade ago they formed their company, Cigra, investing in the latest seed technology and farm equipment, and later buying $400,000 grain harvesters with global positioning systems.

Seven years ago the brothers expanded north into Chaco and Santiago del Estero, provinces where the land was thought to be too dry to support corn and soybeans. Today, with more advanced seeds and better crop rotation, it is considered the frontier for Argentine agriculture. But production there is threatened by declining profitability.

As the government has taken more from the farmers, international prices for the supplies to produce their crops, including fertilizers and seeds, have been rising faster than the prices of the commodities, Marcelo Marchetti said. The price of phosphorus, for example, has nearly tripled since last year, he said.

Suddenly the future seems cloudier. The brothers have decided not to make any investments over the next year.

April 22, 2008 -- Argentine President Cristina Fernandez on Tuesday called for calm as talks with farm leaders grew more tense, raising expectations in financial markets that farmers might go back on strike.

Argentina's farmers staged a three-week strike in March over a tax hike on soy exports, but suspended the protest on April 2 for 30 days in order to negotiate with Fernandez's center-left government.

Farmers have complained of a lack of progress in the negotiations, but Fernandez said discussions should continue.

"We should get back to common sense, responsibility (and) negotiation," she said in a televised speech at the presidential palace in Buenos Aires.

As the end of the 30-day truce draws near, the only concrete development has been an agreement over beef prices and exports. However, that deal has already run into problems and fewer cattle were sent to the main Liniers market on Tuesday.

"The talks are pretty difficult. The only area where we made a small advance was the beef issue, but today we're back to square one," Pablo Orsolini, vice president of the Argentine Agrarian Federation (FAA), told Reuters.

"We're going to carry on negotiating until May 2. We're going to exhaust all avenues, but people are very annoyed and they're already thinking about taking some kind of measure from May 2," he added.

The FAA was one of four agricultural associations that led the strike, which disrupted the country's key grains exports, emptied meat counters and landed Fernandez with her biggest crisis since she took office in December.

UNCERTAINTY

Argentine bonds, the peso currency and stocks took a beating on Tuesday due to the uncertainty over the farm talks, while soy futures at the Chicago Board of Trade closed up, partly on perceptions that the truce in Argentina could break.

If farmers do renew their protest, it is not clear if they would resume the strike tactics seen last month when they halted sales of livestock and grains and manned roadblocks to stop farm goods reaching ports and supermarkets.

Government officials and farm representatives discussed wheat policy on Tuesday and farm leaders said some progress had been made, with the talks set to continue on Wednesday.

"We're looking for points in common ... that's positive," said Mario Llambias, president of the CRA association.

The government has tightly controlled the wheat market in recent years as it seeks to tame rising prices for staples such as bread and pasta.

Argentina is a top five wheat exporter, but the country's exports have repeatedly been restricted in recent years and no wheat export permits have been granted for months.

As negotiations have stalled, farmers have criticized the government for involving Domestic Commerce Secretary Guillermo Moreno, who farmers accuse of using threats.

Some political analysts say the government could be involving Moreno to pressure farmers to accept official proposals.

April 2, 2008 -- Argentine farm groups, seeking to resume talks with the government over tax increases, suspended a three-week national strike that has caused food shortages and disrupted exports.

The strike will be stopped for 30 days, Mario Llambias, president of the Argentine Rural Confederation, said today at a rally in Gualeguaychu, Argentina. Farmers will stay in a ``state of alert,'' he said.

"We will keep fighting,'' Luciano Miguens, president of Argentina's Rural Society, the country's biggest farming group, said in a broadcast carried by Channel 26. "We need to speak to legislators and the judicial authority.''

Farmers went on strike March 12 after the government raised soybean export taxes to a variable rate of about 44 percent from a fixed rate of 35 percent. It was the biggest anti-government protest since the country's financial crisis of 2001, which led then-President Fernando de la Rua to quit.

Argentina, which also boosted taxes on other agricultural commodities, is the world's second-largest corn exporter and the third-largest soybean producer.

The strike caused food shortages in supermarkets and led grain exporters such as Bunge Ltd. to invoke a contractual provision called force majeure, which allows companies to cancel shipments without financial penalties because of events outside their control.

Wheat Exports
Argentina's government will allow farmers to export wheat for the first time since November, Industry Secretary Fernando Fraguio told reporters in Brasilia today.

The halt in the strike means more food will make it to cities starting today, said Juan Echeverria, a leader of the Argentine Agrarian Federation. Hundreds of farmers waving Argentine flags congregated in a field outside the town of Gualeguaychu for the assembly today, images on Channel 26 showed.

"Senators and legislators, here are the people you should be representing, here we are,'' Alfredo De Angelis of the Argentine Agrarian Federation shouted during the rally, which was broadcast live on national television.

Fruit and vegetables already started arriving at Buenos Aires's Central Market earlier today after picket lines on major highways were lifted, Channel 26 showed.

Beef supplies will return to normal in five days, Roberto Arancedo, president of the Liniers livestock market in Buenos Aires, told television channel C5N.

The assembly follows a pro-government rally in Buenos Aires yesterday attended by President Cristina Fernandez de Kirchner and about 100,000 supporters.

April 2, 2008 -- President Cristina Fernandez blasted striking farmers at a rally of 20,000 supporters Tuesday, comparing their nearly three-week-old protest to a 1976 strike that sowed chaos one month before a military coup.

Seeking to build popular opposition to the strike against a disputed export tax increase, Fernandez urged farmers to immediately end hundreds of highway blockades.

"Is it good that highways are cut so that food cannot be transported to market?" she said angrily, adding that such pressure tactics will not work in times of democracy.

On the strike's 20th day Tuesday, farmers manned 300 road blockades, which for weeks have strangled the flow of farm goods to cities, emptying supermarket shelves, blocking key exports and causing the biggest crisis for Fernandez since she took office in December

Small farmers are denouncing a March 11 presidential decree that raised export taxes on soybeans from 35 percent to as much as 45 percent and slapped new duties on other farm exports to attack inflation.

On a stage outside the presidential palace, Fernandez told some 20,000 supporters including trade unionists, laborers and social and human rights activists that farmers imposed "food shortages" on Argentina in February 1976 — just before "our nation's worst tragedy."

The subsequent coup launched a seven-year dictatorship.

The president accused farmers of waging a media campaign to win over Argentine support. "Believe me, I've never seen so many attacks on the government in such a short time, so many insults," she said.

The speech marked a return to tough talk, a day after her government offered concessions intended to benefit at least 62,000 small farmers, including transport subsidies, credits for dairy farmers and tax rebates for small soybean farmers.

Farm groups said they would have no immediate statement on the speech, adding they would make an announcement on Wednesday — the date they say they will decide whether to extend the walkout.

Alfredo De Angelis, a hardline strike leader in Entre Rios province, expressed anger over charges by the president that farmers were allied with the military in leading a chaotic rural strike in February 1976 just a month before the coup.

"We are not coup plotters," he said angrily from a barricade northeast of the capital.

Earlier Tuesday, Argentina's interior minister warned that the government is growing weary of the protests.

"There's no reason for the countryside to still be on strike," Florencio Randazzo said. "We are not going to allow the shortages to continue."

Nestor Barrera, a Tucuman municipal employee who drove past farm blockades in Argentina's heartland to the rally, said it was time to support Fernandez's center-left coalition.

"A big soybean monopoly is behind this strike," he insisted.

Argentine farmers have said they will continue a crippling 19-day strike after rejecting a series of new government measures as insufficient.

April 1, 2008 -- President Cristina Fernandez announced rebates on new export taxes for small- and medium-size farmers but refused to rescind a controversial tax rise.

She asked farmers to "please" lift roadblocks that have caused shortages of products and blocked key exports.

Farmers are furious over new export levies of up to 45% in some cases.

Farmers said their strike would continue until Wednesday at least, but a leader of one of the country's biggest farm groups said dairy products would be allowed to go to market.

No compromise
"I ask you once again to please let the trucks through and think of yourselves as part of the country not the owners of the country," President Fernandez said on Monday in a nationally televised appeal, her third such speech on the issue.

With Economy Minister Martin Lousteau, she announced transport subsidies for farms that are far from markets, some tax rebates for small and medium-sized farms and credit plans for dairy farmers.

But there was no compromise on the key sticking point of a new sliding scale of tax export taxes that would raise levies in some cases up to 45%.

After her speech, the leaders of the four main striking farm groups said on television that the government's offer was insufficient but that they were open to further negotiations.

The farmers briefly halted their action on Friday but resumed the blockades after talks failed to produce a breakthrough.

Some growers working on small- to medium-sized farms say the taxes will reduce their income significantly and complain that they receive no state help.

President Fernandez - who took office in December last year, succeeding her husband, Nestor - has said the taxes are a means to raise badly needed revenue, curb inflation and guarantee domestic supplies.

She has refused to negotiate with the strikers until the farmers' strike is stopped.

This is fast becoming the biggest crisis that she has faced since taking over the presidency, says the BBC's Daniel Schweimler in the capital, Buenos Aires.

As well as causing meat and dairy shortages in the shops, the strike has hit exports and triggered clashes in Buenos Aires.

Argentina, a leading exporter of beef, corn, soya oil and soybeans, has benefited from the recent global surge in commodity prices.

April 1, 2008 -- Argentine farmer groups and the government of President Cristina Fernandez de Kirchner held six hours of talks on March 28 aimed at ending a 16-day-old producers' strike that had restricted food supplies in major cities. Strike supporters lifted some of the blockades they had maintained on highways throughout the country, but more radical sectors said this was only a 48-hour truce and stayed at their positions at highway entrances.

The producers were protesting Fernandez de Kirchner's increase in taxes on soy, a major export crop for Argentina. The president, from the left wing of the populist Justicialist Party (PJ, Peronist), insisted that she would not give in to "extortion" from the producers. She noted that many of the strikers were very wealthy and contrasted their "protests of abundance" with the "protests of poverty" in the early 2000s when "thousands of Argentines [were] blocking streets and highways because they needed work," along with middle-class demonstrators who had lost their savings in the 2001 financial crisis. According to Argentine journalist Stella Calloni, the strike is led by the far-right Argentine Rural Society. Strike supporters held a protest in the Plaza de Mayo in Buenos Aires the evening of March 25. Stella says most of the 5,000 protesters beating on pots and pans were from the capital's richest neighborhoods. Some activists referred to the strike support actions as "fashion protests."

The government has been backed by many activist groups, including the Mothers of the Plaza de Mayo, the Grandmothers of the Plaza de Mayo and the Federation of Argentine Workers (CTA). A Maoist and a Trotskyist group were backing the strike, although not its right-wing leadership. Many groups, including the Trotskyist Movement Toward Socialism (MST), rejected both the government and the strike. The National Picketer ("Piquetero") Bloc said: "[W]e working people and broad sectors of the middle class find ourselves like the salami in the sandwich in this conflict of the 'country' against the government... No one cares about the situation of the people." (La Jornada, Mexico, March 26, 27, 28, 29 from correspondent; Prensa de Frente, Argentina, March 28)

Truck drivers have clashed with farmers who set up roadblocks across Argentina

March 28, 2008 -- Argentinian farmers have suspended a 16-day strike against higher taxes on grains exports and said they would begin talks with the government.

The farm protests in Argentina had halted grain exports and led to food shortages in parts of the country, presenting Cristina Kirchner, the country's president, with her biggest crisis since taking office in December.

"The objective is to facilitate a meeting with the national government, after which we will evaluate the results, which will be submitted to the rank and file nationwide," the four biggest farming groups said in a statement on Friday.

Farm groups said they were responding to Kirchner's call the previous day, when she said the government would negotiate if the farmers ended their protest.

Blocked Roads
The groups said they would remain on the side of the roads ready to resume road blocks while they negotiate with the government.

The protest, over a steep increase in taxes levied on soya beans, had been escalating, with demonstrations for and against the government and clashes between farmers and transporters angry about the blocked roads.

The taxes, of up to 45 per cent, were imposed on a range of goods including soya beans, sunflower oil and beef in a bid to boost state revenue at a time of exceptionally high commodity prices and to curb high inflation in the country.

Kirchner had labelled the farmers "extortionists", and said high commodities prices on the world market, coupled with Argentina's devalued peso, had made many rural landowners very wealthy.

Some of the country's middle class, itself decimated in the a devastating financial collapse in 2001, sided with the farmers and held solidarity demonstrations in Buenos Aires.

Kirchner's supporters - drawn from the large poor underclass - countered with their own marches and in some cases clashes erupted.

On Thursday, she had struck a more conciliatory tone, pleading with farmers to end their strike.

"The government's doors are open but please, lift this strike for the sake of the people," she said.

Store Shelves Grow Bare as Argentine Farmers Continue Strike

March 27, 2008 -- As a strike by farmers continued for a 13th day Tuesday with no solution in sight, its impact was visible on meagerly stocked supermarket shelves in cities.

Butchers and supermarkets were among the first hit.

"We are looking for alternative suppliers because within 24 to 48 hours, we will have no more meat," said Miguel Calvete, who runs a Chinese supermarket in the capital.

Hundreds of Argentines took to the streets of the capital, where they banged pots and pans in support of the striking growers, who are protesting an increase in export taxes for their products.

One economist warned that the strike could result in more serious problems than short-term scarcity.

"The most dangerous [scenario] is that there might also be problems of inflation with supply, which is a type of combustible that generates more inflation," said Jorge Colina. "The fewer products and goods available to place on the shelves, the more room for increasing prices."

Argentine President Cristina Fernandez was unswayed, referring to the growers' demands as "extortion" and saying the increases on agricultural products are justified.

"It is the sector that exports almost everything," she said. "About 95 percent of soybeans are exported. They're not exported in Argentine pesos, they're exported in euros, in dollars. But the costs are Argentine costs."

The farmers' federations, for their part, announced that the strike will continue for an indeterminate period of time.

"We thought this was going to generate a conciliatory discussion, but it has had the opposite effect," said Alfredo Rodes, executive director of the Confederation of Rural Associations of Buenos Aires and La Pampa.

He said the taxes go directly to the central government, not to the provinces where the farmers live, and he accused the government of demanding "practically half" of farmers' production in taxes.

His group, which organized roadblocks, posted where they would be on the Internet.

But traffic jams still occurred, inconveniencing many people.

"They have to try to resolve this as soon as possible," one woman said. "There are kids who are trying to get to school, and they're not arriving."

March 27, 2008 -- Striking farmers built new highway blockades around Argentina's agricultural heartland Wednesday in a standoff with the president over tax increases on major export crops.

The nationwide farm and ranch strike headed into a third week on Wednesday, all but paralyzing one of the leading world exporters of soybeans, beef and wheat. There were no reports of major violence.

Farmers rumbled in a convoy of tractors through the central city of Cordoba and laid sharp spikes across a key trucking route through rolling farmland in Buenos Aires province. Long-distance bus companies scrapped service as more demonstration gauntlets went up in six provinces.

In a televised address on Tuesday, President Cristina Fernandez rejected any rollback of a March 11 decree that raised taxes on soybean exports from 35 percent to 45 percent and slapped new taxes on other farm exports.

March 27, 2008 -- Farmers in Argentina who have been on strike for two weeks to protest a tax increase on the export of grains said Wednesday that they would continue their protests until the government gave in.

The strike has led to shortages of meat and dairy products, paralyzed local grain and livestock trade and forced major exporters of Argentine soy products to renege on some contracts. Thousands of people rallied nationwide on Tuesday evening in support of the farmers. The protesters banged on pots outside the presidential palace after the center-left president, Cristina Fernández de Kirchner, said she would not give in to “extortion.”

Hector Boldrini, a farmer, said, “The government tried to put out the fire with gasoline.”

“There’s no way we will cede ground,” he said at a roadside protest in Pergamino, in the fertile northern region of Buenos Aires Province.

Elsewhere in Argentina, farmers blockaded highways to keep trucks from transporting agricultural goods. The government said it would clear the roads by force if necessary to get food to market.

Several suppliers of Argentine soy and soy oil declared force majeure to back off from sending cargoes to China as a result of the protest, following a similar move on soy meal shipments to Europe, traders and industry officials said.

The strike has slashed foreign currency inflows from agricultural exports, sending the local peso currency to its weakest level against the dollar in five months.

Argentina has been one of the world’s main beneficiaries of a global surge in commodities prices. But farmers abhor government measures like export bans and price controls, which are being put into effect to stem inflation and to increase revenue. The farmers say they intend to continue the strike as long as necessary, demanding that the government repeal a new sliding-scale export tax regime that raises levies on soy and sunflower products at current prices.

Ms. Kirchner has said the taxes help redistribute wealth in a country where nearly a quarter of people are poor.

March 26, 2008 -- Argentine President Cristina Fernandez vowed on Tuesday that the government would firmly rejected demands by farmers prolonging their days-long strike against an export tax hike.

Pledging not to give in to extortion, the president said the government would negotiate, but the strike, which began March 13, should stop first.

Facing the largest farm and ranch protest in decades and her most serious challenge since she took office, the president said in a speech that she understands agriculture's interests, but also wants farmers to know she is the president for all Argentine people.

Argentine farmers, who are protesting against a government measure to increase soya export tax from 35 percent to 45 percent, have blocked roads with trucks and tractors and vowed to continue the strike as long as necessary.

The tax hike is aimed at garnering more revenue for the government amid soaring soybean prices, but the farmers claim the government is robbing them of their money.

The strike has forced the country to face a looming food shortage of farmed beef, dairy products, oil and grains.

Argentina is one of the world's leading exporters of beef and soybeans.

March 26, 2008 -- President Cristina Fernandez refused to ease tax hikes on agricultural exports Tuesday, facing down angry farmers embroiled in a nationwide strike that has all but halted production in one of the world's biggest beef-exporting nations.

At least 9,000 cattle normally enter this capital's sprawling stockyard each day for slaughter, yet not a single animal arrived this week due to the farm and ranch strike, the largest in decades.

South America's second-largest economy — a leading exporter of soybeans, beef and wheat — is in full farm belt rebellion over a new sliding-scale increase in export taxes. Soybean taxes are being hiked from 35 percent to 45 percent, with smaller increases on corn and other farm products.

Scattered shops began emptying of beef, milk, chicken and cooking oil Tuesday as farm workers mounted the most serious challenge yet to Fernandez's fledgling government.

"Bad policies by the government are leaving people without food, without beef," complained Mario Llambias, one of the farm protest organizers who announced Tuesday a 13-day old strike would now continue "indefinitely."

But Fernandez appeared undeterred as she delivered a televised address later in the evening. Vowing not to "give in to extortion," the new president declared that her government will not grant any concessions to the striking farm and ranch workers.

Fernandez said farm producers have profited from a boom in commodity prices and it is only fair to tax them more to redistribute wealth to poorer parts of society. "This seems like ... comedy," she said.

Late Tuesday, thousands of angry middle-class residents of Buenos Aires and other cities responded to her speech by banging pots in a raucous, spontaneous outpouring of support for the farm workers. Strikers lit tires on fire after nightfall on blockaded roads and vowed to stiffen their protests.

"Argentina! Argentina!" some 5,000 people, including mothers with strollers and others banging on pots joined a surging and unexpectedly strong challenge to the government.

Other protesters in farm-dependent cities and hamlets across Argentina's farm belt waged similar pot-banging protests.

"This is a pretty ugly wakeup alarm for the government after just a few months in power," said one angry protester Hector Bernardino, among the 5,000 who thronged the main Plaza de Mayo in Buenos Aires.

He said middle class Argentines, like the farmers, are weary of taxes and double-digit inflation he said the government has sought to conceal behind praise for years of robust recovery.

After a searing 2002 economic meltdown, the government replenished its coffers through taxes on surging grain exports and soaring commodity prices. The cash influx powered an economic growth rates topping 8 percent annually.

Argentina's economy is back on track — and agriculture remains one of its most profitable sectors. It's only fair that farmers and ranchers be taxed on more of that wealth, according to Economy Minister Martin Lousteau, who announced the controversial tax overhaul on March 11.

Growing demand for foodstuffs in China and other teeming nations, high oil prices and other shifts in the global economy have all helped pushed grain prices to new highs in recent months.

But the agriculture industry is howling at having to pay more.

The farmers are demanding to sit down and negotiate a rollback on the new taxes, which Buzzi calls "extortion" against farmers. The government says it won't start talks until the protests stop.

And so the daily demonstrations have continued, with belching tractors and giant harvesters blocking rural highways nationwide, occasionally sowing monstrous traffic jams.

During the long Easter holiday weekend on routes from the capital to South Atlantic beaches, many Argentines stuck in the traffic applauded the demonstrators, saying they too are fed up with government taxes.

The protests have spread far beyond the capital, with sugarcane workers beating cane stalks along highways in north-central Tucuman province and soybean farmers dumping mounds of beans near the border with Uruguay.

Police have managed to keep the most important routes open without wide scale arrests or violence. But the confrontations have been tense.

And now Argentina's consumers are beginning to feel the pinch.

In the country's main stockyard Tuesday, the Liniers market, a lone cowhand galloped on his horse past empty cattle pens where thousands of cattle usually jostle.

One supermarket group warned of dwindling wheat, rice and pasta supplies in the western city of Mendoza. In eastern Rosario, cooking oil shortages were reported.

"I don't even have chicken left," said one idled butcher, Alfredo Estefano. "We haven't seen a strike like this in 20 years."

March 25, 2008 -- Argentine farmers vowed on Tuesday to extend indefinitely a two-week protest against new taxes, as the first signs of food shortages put pressure on President Cristina Fernandez to resolve the biggest conflict she has faced.

Trade at the country's biggest grain and cattle markets has ground to a halt since the strike began on March 13 and diminishing supplies of beef and some dairy products were reported at stores.

Farmers have blocked roads with tractors across the country during the protest and grains shipments have been affected. Argentina is one of the world's leading suppliers of soy, corn, wheat and beef.

Strike leaders said the protest would continue until the government shelves the new export tax regime, which introduces a sliding-scale of duties and substantially raises levies on soy and sunflower sales.

Eduardo Buzzi, president of the FAA association, told a news conference that agricultural leaders had agreed to "continue this strike for as long as necessary."

Justice Minister Anibal Fernandez told local radio the government was willing to negotiate but it will not allow the farmers to say "how things should be done." Ministers have said the strike must be called off before talks can start.

It is the biggest conflict Fernandez has faced since she took office in December, and it marks a deterioration in tense relations with farmers, who have criticized anti-inflation measures such as export bans and price controls.

Most grains exporters have been hit by the blockades, an industry leader said.

"At the moment, the majority (of grains exporters) are not operating. Because we've ended up with no stock. No grains, no oils and no meal, said Alberto Rodriguez, director of the Cereal Exporters Center (CEC) and vegetable oil group CIARA.

Some exporters declared force majeure last week, switching soy shipments to the United States, U.S. traders said.

FRUSTRATED
Consumer and retail groups said reports of bare shelves at supermarkets and grocery stores were increasing as the strike dragged on.

"In general, the things that are lacking are beef and some dairy products," said FABA, a federation that groups small grocery stores across the country.

The protest in Argentina has also weakened the value of the peso currency due to fewer inflows of dollars from agricultural exports.

But road blockades have become the most visible aspect of the protest. In some areas, frustrated truck drivers began clearing highway barricades themselves.

The demonstrators have been letting trucks pass as long as they are not carrying farm goods.

Farmers at roadblocks handed out pamphlets, saying the government's hefty export taxes "take (money) from rural communities, from our shop owners and our industries. With this money there could be more investment, more jobs and a better future for everyone."

Government officials have sent some signals of trying to end the crisis, by announcing price cap agreements on fertilizers and proposing to form a special agency to deal with issues faced by small farmers.

But so far, that has not been enough for farmers, who say the export tax hike was the last straw.

The government has used levies on grain exports to boost state revenue at a time of exceptionally high commodities prices, and to curb high local inflation, particularly on basic food items.

March 25, 2008 -- Argentina may face worsening food shortages as a farmers' strike over higher export taxes enters its 13th day, Goldman Sachs Group Inc. said.

Farmers protesting the tax increase blocked trucks from entering ports and warehouses and maintained picket lines on the country's major highways. Justice Minister Anibal Fernandez rejected negotiating with farmers under conditions they set.

The government's new variable-rate export tax on soybeans and sunflower seeds, announced March 11, raised the soybean levy to about 44 percent from a fixed rate of 35 percent. The move prompted farmers to stop sending crops and animals to markets, reducing the food supply. The resulting food shortages may worsen, Goldman Sachs analyst Pablo Morra said today.

"There are already reports of shortages of meat, dairy products and vegetables caused by the strike,'' Morra said in a research note sent by e-mail. Even as shortages deepen from the strike, Morra said, the government of President Cristina Fernandez de Kirchner "remains firm in its decision to raise the agricultural export taxes.''

"The ongoing farmer strike has become the most serious conflict facing the government'' since the president took office in December, Morra said.

Farmers and truck drivers who side with the government clashed at roadblocks yesterday, prompting farming groups to ask for police protection. The groups, led by Argentina's Rural Society, may meet with government ombudsman Eduardo Mondino today in Buenos Aires, newspaper La Nacion reported.

Open to Talk
The government is willing to talk with the growers' groups, Anibal Fernandez indicated today in a Radio America interview.

"There's no other option but to talk responsibly, once everyone has calmed down,'' he said.

Argentina's grains exports are being affected, said Adrian Seltzer, a broker for Granar SA in Rosario, the country's biggest grain-shipping port. Granar has traded grain on the Buenos Aires Cereals Exchange since 1938. Argentina is the world's second-largest corn exporter behind the U.S. and the third-largest soybean exporter.

Just 19 trucks carrying soybeans and four with corn reached the port of Rosario today, compared with the 5,000 to 6,000 grain-loaded trucks that arrive on a normal March day, Seltzer said. Rosario normally handles more than 60 percent of the country's grain exports.

"As the exporters don't know when this farmers' blockade will end, they are already diverting ships'' from Argentine ports, Seltzer said.

Governors in the agricultural provinces of Chaco, Cordoba and Entre Rios may step in to broker talks between farmers and national government officials, newspaper Clarin said today.

Meanwhile, dwindling choices may confront shoppers at grocery stores in Buenos Aires.

"There's little meat in the capital, and with people returning from their vacations, it will all be gone soon,'' said Alberto Williams, vice president of the Buenos Aires Butchers Association. "This should end as soon as possible, so it doesn't affect more people.''

March 25, 2008 -- Shops in Argentina are going empty of beef, eggs and cooking oil as farmers and ranchers revolt against tax hikes.

Farmers and ranchers are blockading highways and dumping soybeans, cotton and other crops on the roads to protest a new government tax hike on exports. Argentina's biggest agricultural strike in decades is now entering its 13th day, with traffic jams reported Tuesday throughout the vast farm belt.

President Cristina Fernandez says her government won't negotiate until the protests stop. Farmers and ranchers say they will keep striking until the government comes to the bargaining table.

A worker walks past the empty stables of the live cattle market in Buenos Aires, Tuesday, March 25, 2008. Highway blockades by farmers protesting new tax hikes on soybeans and other grains, have interrupted transportation and slowed the supply of cattle to market. The strike by farmers, now in its 13th day, began after Argentina's government announced increases in export taxes.

A modern harvester leads a caravan about four miles long of tractors and trucks loaded with angry farmers on strike against increased taxes, that blocked highway 9, a strategic route of the Argentine pampas on March 19, 2008 near San Pedro, province of Buenos Aires, Argentina. After seven days, the strike was extended by 10 more days. (The banner on the harvester's front reads "There is no future without the countryside").

A group of farmers block the road in the route 9, near the city of Oncativo, province of Cordoba, during countrywide protests against the sharp tax hike on soya exports on March 24, 2008.

Farmers block a road in Tandil, Argentina, Tuesday, March 25, 2008. Farmers and ranchers are blockading highways and dumping soybeans, cotton and other crops on the roads to protest a new government tax hike on exports. Argentina's biggest agricultural strike in decades is now entering its 13th day, with traffic jams reported Tuesday throughout the vast farm belt.

A group of farmers burn an old combine harvester in the route 168, at the entrance of the Uranga-Silvestre Begni sub-fluvial tunnel during countrywide protests against the sharp tax hike on soya exports on March 24, 2008 in Parana, province of Entre Rios. 

The government imposed last week a tax hike on soya exports as a way of raising extra revenue on the back of the worldwide demand for commodities which has seen the price for the beans skyrocket 70 percent in the last year.

March 20, 2008 -- Government policies aimed at fighting inflation and cashing in on high global grains prices could lead Argentine farmers to grow less wheat and soy, a leading grains producer said Wednesday.

Argentina is one of the world's top suppliers of soy, wheat, corn and beef, but surging export demand has pushed up the price of everyday staples and the government has responded with export bans, price controls and export tax increases.

Last week, the government raised duties on soy and sunseed sales abroad -- a measure that has infuriated exporters and farmers, who are staging a week-old strike that has paralysed grains markets.

The higher taxes could also have a longer term impact, said Egidio Mailland, president of the Association of Argentine Cooperatives (ACA), the nation's No. 8 grains exporter.

"Putting a ceiling on the soy price means the crop's profitability is abruptly altered in areas where it's impossible to improve yields, in areas where the climate isn't best-suited," he told Reuters.

Industry analysts have also said last week's tax shake-up could hit output of the oilseed in less profitable parts of the country, the world's third-biggest soy supplier and its top exporter of soyoil and meal.

Announcing the new sliding-scale export duties system, Economy Minister Martin Lousteau said it would guarantee farmers price stability, but Mailland said it would destroy the futures market and make it harder for farmers to plan.

"If I don't know how much tax I'm going to be paying in three months, I can't put a value on the grains within three months ... They've thrown out all the traditional systems," he said.

ANGER
Seeking to boost the production of corn and wheat -- which weigh heavily on local food price inflation -- the government trimmed export duties on those grains.

However, Mailland said anger among farmers over continued government intervention in the wheat market would likely reduce the 2008/09 crop area when sowing starts in May.

The 2007/08 wheat export registry remains closed as the government seeks to safeguard domestic supplies. The closure has driven down prices in the local market at a time when costs have almost doubled, Mailland said.

"There is a despondency and a phenomenal decline in sowing intention. This is very serious," he said, adding that surveys conducted among ACA members showed farmers plan to sow between 30 percent and 40 percent less wheat this year.

Last week's tax overhaul also involved a hike on the levy on biodiesel sales abroad to 20 percent from 5 percent.

ACA, which exported some 2 million tonnes of grains and 1 million of by-products last year, is about to move into the country's fast-growing biodiesel industry with the construction of a $50 million plant at a port on the Parana River.

Mailland said the joint venture was still on track although the tax hike had "taken a big chunk" out of potential profits.

The association, which accounts for more than 10 percent of Argentine grain production, is also involved in the supply of fertilizers, seeds and vaccines for ranchers and is the top honey exporter.

Despite the current tension, Mailland said Argentina's output of grains might cross the 100 million tonne mark in 2008/09. Last season, a record harvest totalled 95 million tonnes, but drought and frosts have hit the current campaign.

He said such levels of production would strain transport capacity, and called for more spending on road building.

"This is one of the things that's being asked for now (that) they're taking a big part of our earnings," he said.

March 20, 2008 -- Farmers protesting a hike in export taxes on soybeans and other grains abandoned their fields and blocked highways for the seventh straight day Wednesday, slowing the flow of farm products to markets nationwide.

Four of the country's largest farm groups vowed to strike until President Cristina Fernandez's government repeals a sliding tax increase on soy and grain exports seen as an attempt to boost state revenue while global commodity prices soar.

Protesters in rumbling harvester machines and noisy tractors burned a truck and dumped soybeans on the highway, blocking a major road through the province of Buenos Aires, where soybean, corn and other crops are grown.

Police did not intervene, and similar protests were reported across the broad pampas, a vast farming and ranching area in central Argentina, an agriculturally rich nation.

Cabinet chief Alberto Fernandez called the strike completely "out of proportion" with the new taxes, announced by presidential decree last week.

"The farm sector has yielded extraordinary results in recent years," helping to lead the way out of Argentina's 2002 economic crisis, he said. Soaring soybean, corn and other grain prices have left farmers better off than many other Argentines, he said.

A spokesman for the farmers, Rodrigo Miro, said they will escalate their blockades next week, if the government refuses to hold talks on the taxes with the four farm groups.

But Agriculture Secretary Javier de Urguiza warned that protesters must stop the strike as a condition for talks a call demonstrators have resisted.

They meanwhile warn the strike may cause beef and other food shortages across Argentina, as protesting ranchers and farmers stay off the job.

Buenos Aires' Liniers market, for example, normally receives hundreds of cattle a day. This week, less than 100 animals arrived daily.

March 17, 2008 -- Farmers in Argentina, the world's largest exporter of soybean oil and meal, will protest last week's export-tax increases on grains and oilseeds for a fifth day and withhold produce.

Farmers and unions will block highways in cities across the Argentine Pampas, the Argentine Rural Confederation said yesterday in an e-mailed statement.

Growers and union leaders aren't "going to negotiate with the government until it suspends the new export tax,'' said Pablo Adreani, whose Buenos Aires analytics firm, Agripac, has tracked Argentina's agriculture industry since 1994. The tax "represents the end of competitiveness and the development of Argentine agriculture,'' he said in an interview.

President Cristina Fernandez de Kirchner introduced a variable export tax last week that imposes levies of more than 44 percent, based on the prices of soybeans and other crops traded on futures exchanges in Chicago. Farmers say the taxes will discourage investment in this year's crops and in cattle herds, leading to food shortages.

The government said last week it would tax soybean meal exports at 3 percentage points less than the variable tax rate on soybeans. In today's official gazette, the discount was raised to 4 percentage points.

Argentina is the world's second-largest corn exporter behind the U.S. and the third-largest soybean producer, behind the U.S. and Brazil.

Adreani predicts farmers may reduce planting of soybeans by 2 million hectares (4.94 million acres) in northern areas where more agro-chemicals are used to raise the oilseed.