Soy GDP will decrease by 26%

At the time of development
the effects of drought, it is observed that losses are not only visualized in the primary link. Reduced area and production have had negative impacts along the soybean chain, with lower milling, lower sales of certain inputs, reduced badociated services and lower expected exports

The milling of the oilseed, so important for the net generation of foreign currency of the country, since the flour, oil and soy biodiesel together account for 25% of national exports, would fall to However, the This will be less than the decline in cereal production, as soybean imports, especially from Paraguay, will increase during the 2017/18 season. from other neighbors, but also from the United States, to increase supply and support grinding. It is also estimated that some of the stocks accumulated in previous seasons will enter the commercial circuit and significantly reduce cereal exports.

As a result, based on estimates from the Institute of Economic Studies of the Grain Exchange, the gross domestic product the soybean chain will be 26% lower in 2018 than it would have been if current expectations at the beginning of the agricultural cycle were met, from $ 16,213 million in the initial scenario to $ 12,010 million in the drought scenario.

In terms of the economy as a whole, the US $ 4200 million decrease in the value added of the soybean chain represents a 0.6% decline in Argentinian GDP for 2018 estimated by the IMF. [19659007] Most of these losses are concentrated in producers, who will resign from this campaign for a value added of $ 2,600 million. From a tax perspective, they would deposit nearly $ 1400 million less to the state in terms of withholding tax and other taxes that are levied on all links in the chain. If it is valued in terms of net exports, the impact is estimated at $ 4842 million.

The author is an economist from Buenos Aires Grain Exchange