Soy: by retentions and falling prices, its purchasing power has dropped 39%

Agrovoz Drafting

Beyond the recorded record crop, the past year has not been good for grain in economic terms. The impact of withholding taxes and lower prices have affected the contagion effect of the economy. So much so that the purchasing power of soybeans has dropped by 39%, according to a report prepared by the Córdoba Grain Exchange.

Corn was not exempt from this situation either. In the case of cereals, the input ratio of products deteriorated by 33.5%.

Dollars and deductions

Over the past year, market grain prices available in Rosario have dropped, mainly due to an abundant global supply scenario, increased export rights and the difficulty of the markets. domestic prices to follow the price of the dollar. Thus, compared to April 2018, soybeans lost $ 90 per tonne and maize $ 47.4, according to the report of the institution.

Although the international context has not been favorable to crops, the external scenario does not explain the total fall in prices of local market dollars. In September of last year, export duties were reinstated, averaging 9.3% in April, further off the domestic price of international prices.

"By contrast, in April of this year, the exchange rate had accumulated an interannual variation of 113%, while the rise in the price of grain in pesos was 56%, which explains part of the decline in the price available in dollars, "says the report.

Ratio of the product of entry

Because of the impact of these variables, the purchasing power of corn and soybeans has decreased, which is evident in the amount of production needed to acquire a certain amount of inputs. According to the warnings of the Córdoba stock market, in the midst of soybean and corn harvest, it is very important to observe the input-output ratio "to badyze the convenience of adjusting part of the production through the l & # 39; 39, purchase of inputs to set the production costs of the new campaign

Soybean appears as the most affected grain, with a 39% worsening of the average purchasing power. According to the figures of the stock market entity, to buy glyphosate in April 2019, it took 62% more and to buy seeds, 42% more than was required the previous year.

With regard to phosphorus fertilizers, the interannual variation indicates that 36% more grains are needed.

Maize suffered a degradation of its purchasing power of 33.5%. To buy urea, it took 32 percent more, while to buy seed, it took 36 percent more in April compared to the same month in 2018.

"Increases in the input-output ratio are due to the fact that the decline in grain prices has outpaced the decline in dollar prices of certain inputs such as diesel, phosphorus fertilizers and urea." Glyphosate was one of the few inputs to increase by 14% over the same month last year, and one of the main inputs for soybean cultivation has affected the purchasing power of oilseeds, "he said. he declares. The report.