Argentine producers clashed with industry association Ciara over claims that the country’s soybean prices would be hurt by US levies on biodiesel imports, saying that there were “many alternatives” for demand.
The Sociedad Rural Argentina, one of the South American country’s biggest farming associations, said that there was “no merit” in a caution from Ciara, the national oilseeds industry chamber, over the soy price impact of Washington’s move to impose duties on US imports of Argentine biodiesel.
Ciara termed “probably the most pernicious effect” of the US proposal – threatened over claims that Argentina is selling biodiesel at prices lowered artificially by the effect of government subsidies – that it will prompt a “reduction in into the price of soybeans”.
Ciara noted that the US last year – through its imports of biodiesel, which is made from vegetable oils – bought from Argentina the equivalent of 7.5m tonnes of raw soybeans.
However, the Sociedad Rural Argentina, or SRA, said that there were alternative sources of demand for the soy displaced from the US market via the duty plans, which could see Washington slap levies of up to 64.2% on imports of Argentine biodiesel.
Brighter prospects for sales to EU
The SRA noted that there could “soon be a solution to the blockade that the European Union has imposed on Argentine biodiesel”, with talk that Brussels could as early as Thursday cut import duties of 22-25.7% imposed in 2013.
These levies were, like the US ones, imposed over anti-dumping claims, but were put in line for a rethink by Brussels by a World Trade Organization ruling last year.
The European Union had been the top buyer of Argentine biodiesel exports before the tariffs were introduced, a move which saw the shipments focused instead on the US, which bought some 90% of the total exports of 1.6m tonnes last year.
The SRA flagged the prospect of rising biodiesel demand in other markets thanks to improved economic growth prospects, which imply enhanced energy demand.
And it noted the growing demand for soyoil itself from buyers such as China, where key trader Sinograin two weeks ago revealed that it was reopening to purchases of the vegetable oil from Argentina.
The move comes amid a jump in China’s soyoil imports of 53% to 436,759 tonnes in the first seven months of 2017.
But only 285 tonnes of that, worth some $330,000, all in July, has been sourced from Argentina, which reportedly used to sell China some $1.4bn of soyoil a year.
‘No reason for price reduction’
“The Argentine [vegetable] oil industry has many alternatives for the placement” of soyoil and biodiesel, the SRA said.
“Contrary to what was expressed by Ciara… we see no reason for a reduction in the price of soybeans.”
In fact, soybean prices on the Rosario exchange have stood firm since the US announcement, on August 23.
(Source – http://www.agrimoney.com/news/argentine-growers-slam-warning-of-soy-price-dent-from-us-levy–10992.html)