The Argentine government, under President Javier Milei, issued a decree on Friday, June 27, increasing export taxes (“retenciones”) on key agricultural commodities, effective Tuesday, July 1.
\nAccording to the decree, the export tax on soybeans will rise from 26% to 33%, while levies on corn and sorghum will increase from 9.5% to 12%. The tax on sunflower oil will also increase\u2014from 5.5% to 7%. Meanwhile, taxes on wheat and barley will remain at 9.5%, and the export tax on wheat flour will drop to 5.5%.<\/p>\n
Since taking office in December 2023, Milei has pursued a sweeping agenda of economic reforms. One of the most anticipated policies during his campaign was the reduction\u2014or outright elimination\u2014of agricultural export taxes.<\/p>\n
Initially, his administration reduced the soybean export tax from 33% to 26% and lowered the rates for soybean meal and oil from 31% to 24.5%. Wheat and corn export taxes were also cut from 12% to 9.5%. However, in April, President Milei announced that these reductions would be reversed by the end of June.<\/p>\n
Sector reactions were mixed. Both the Argentine Rural Confederation (CRA) and Coninagro voiced concerns over the negative impact of tax hikes on producers. Still, Nicol\u00e1s Pino, president of the Argentine Rural Society (SRA), urged calm.<\/p>\n
“I have no reason to doubt the president’s word when he said during the campaign\u2014and repeated here in our home\u2014that export taxes are a terrible tax. We are on the right path, which is why I advocate for moderation. Let’s wait a bit,” Pino stated.<\/p>\n
He also confirmed that President Milei is expected to attend the opening ceremony of the annual Rural Exhibition in Palermo, though there remains uncertainty about how producers will receive him.
\nAccording to estimates from the Buenos Aires Grain Exchange (BCBA), Argentina is set to recover its soybean and corn production in the 2024\/25 harvest.<\/p>\n
After two consecutive years of crop losses due to adverse weather, the country now projects a soybean output of 50.3 million tonnes and a corn harvest of 49 million tonnes.<\/p>\n
Soymeal Exports to China<\/strong> According to Bloomberg, the Asian country purchased the Argentine product as part of its strategy to secure essential animal feed supplies amid ongoing trade tensions with the United States. This first shipment is viewed as a market test and will comprise 30,000 tonnes, with an expected departure from Argentina in July and arrival in Guangdong province, southern China, by September, Bloomberg reported.<\/p>\n The cargo was jointly ordered by Chinese traders and feed producers and was priced at approximately USD 360 per tonne, including freight.<\/p>\n Source: Exame<\/a><\/p>\n
\nThe tax hike comes amid reports that Argentina is sending its first-ever shipment of soybean meal to China.<\/p>\n
\nArgentina is the world’s leading exporter of soybean meal, with annual shipments totaling around 50 million tons. Although Beijing approved soybean meal imports from Argentina in 2019, no actual trade has occurred\u2014until now.<\/p>\n