Port workers' strike affects Argentina's grain exports

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Publish time: 27th May, 2013      Source: www.cnchemicals.com
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May 27, 2013

   

   
Port workers'' strike affects Argentina''s grain exports
   
   

   

Argentina, the third largest exporter of soy and corn and the global leader in supplies of soy oil and soymeal, suffered another blow as its grain exports were halted by dock workers'' strikes at ports.

   

   

About 80% of Argentine exports of grains and oilseeds leave from Rosario on the Parana River, one of the ports affected by the industrial action. Rosario is also a port complex most vulnerable to strikes because movement of all ships in and out of the Rosario port system, which includes several docks, is tightly controlled by worker unions.

   

   

Argentina''s exports of grains and perishable goods are especially hit after three days of the stoppages and many loaded vessels will likely end up with spoiled merchandise before the industrial action is over, industry analysts warned.

   

   

Industry estimates say the trade losses could run into tens of millions of dollars. Argentine President Cristina Fernandez de Kirchner is struggling to meet shortfalls in the country''s foreign exchange holdings. The strikers are demanding higher wages to reflect Argentina''s runaway inflation and have vowed to continue their action until demands are met.

   

   

Argentine traders hoped to capitalise on recent low yields of graincrops in the US and recent trends indicated that Argentine traders could be handed windfall profits. The strikes have put paid to that optimism.

   

   

Argentine port system is vulnerable to frequent disputes, often hitting not only Argentine trade but also trade from land-locked Paraguay passing through the country''s waterways.

   
   
More important, analysts said, the country''s continued isolation in international capital markets makes Argentina increasingly dependent on agricultural earnings for its gross domestic product. However, government curbs on foreign currency movements have added political tensions between officials and traders and forced many grain exporters to cut back on labour -- seen as one of the causes of the current unrest at the ports.
   


The US crop slowdown and rising demand drew more shipping than usual to Argentine ports. Talks are under way to resolve the labour conflict, officials said.