Argentina's agri dollar to include wide list of products

10 Apr 2023 | Marcela Caetano

Argentina’s government published a decree on Monday that officially confirmed the new agri dollar scheme - the third such iteration - and announced a preferential exchange of 300 pesos per dollar for soybeans, soymeal, soyoil, and biodiesel.

The decree includes over 50 products in the regional products list that are also able to be traded within the scheme.

Despite the mention of cereals in the list of regional products, wheat, and corn are not included in the program, market participants said, although sorghum and barley is, alongside sunseeds. 

“However, the government needs dollars urgently so it is possible they will include these products in the program later on,” Paulina Lescano, agricultural engineer, and specialist in agricultural markets told Agricensus.

Argentina has already launched two soybean dollar regimes in 2022, setting a preferential exchange rate from US dollars to pesos for soybean sales to encourage farmers to sell their crops and increase revenues for the state amid a shortage of US dollars.

For soybean and byproducts, the program will be valid until May 31, and for regional products, until August 31.

Soybean exports from the new agri-dollar scheme will bring $ 5 billion in revenue, the country’s Agriculture secretary, Juan José Bahillo, projected last week.

Revenue from the regional products is expected at $ 4 billion. 

"The bulk of it will come from soybeans" Javier Preciado Patiño, former Undersecretary of Agricultural Markets at Argentina’s Ministry of Agriculture, MAGyP, told Agricensus.

Despite the wide list of products, seen as too ample by market participants, the secretary of agriculture has broad freedom to decide who can access this special dollar, according to the decree.

The document also says only producers who have exported in the past 18 months will be able to use the differential exchange rate.

“The selection will certainly be very rigorous, and the revenue can be reduced," Patiño added.

"Giving the exporter a 300 pesos per dollar exchange rate means issuing money and this generates inflation, depreciating currency even more," he said.