BUENOS AIRES, June 10 (AP): Argentina, one of the world's biggest breadbaskets, should be rolling in cash as world food prices soar.
Instead, soy, wheat and corn have sat for weeks in silos as farmers protesting new export taxes suspended sales.
Farmers were lifting their strike Sunday night in a last-ditch effort at a third round of talks. But their three-month standoff with the government has already paralysed the rural economy, caused scattered food shortages and tanked the new president's popularity.
And continued stalemate could spike global grain prices at a time when food costs are already high.
Still, experts say grain prices won't rise forever, and many warn that Argentina may be missing its shot at that record revenue - and headed for economic crisis.
"They are killing the goose that lays the golden eggs," said Claudio Loser, a former Latin America director at the International Monetary Fund (IMF).
Farmers meet Monday with a national ombudsman who has offered to broker the crisis, but the government has not yet agreed to join talks.
Argentina is one of the world's top four providers of soy, corn, beef and wheat, and rising farm exports - up 48.2 per cent since 2003 - helped the country rebound from economic meltdown in 2002, driving five years of more than 8 per cent annual growth.
Exports stood to climb even higher this year, as international soybean prices jumped about 26 per cent and corn prices about 34 per cent between January and June.
To tap those gains, President Cristina Fernandez decreed a new sliding-scale tax on March 11, boosting rates on grain exports as prices rise. Current export taxes on soy, for example, jumped to 46 per cent from 35 per cent, and would top 50 per cent if prices swelled above $600 a metric ton.
The move was meant to tame inflation by trapping exports in Argentina, driving down local prices and encouraging cultivation of stocks like wheat and cattle, which have been abandoned for more lucrative soy.
But objecting farmers have suspended grain shipments for 89 days in protest, crippling rural towns with roadblocks and layoffs and causing food shortages in cities including Buenos Aires. Cattle ranchers affected by separate export restrictions also halted sales.
Ships at Rosario, one of the country's main ports, now drift idly awaiting cargo at a cost to exporters of as much as $70,000 a day. Last week, thousands of truck drivers idled by the strike blocked highways, demanding that farmers and the government negotiate.
About 75 per cent of Argentines agree that talks are needed, while 14.5 per cent support continued protests, according to a May 25-26 poll by Ricardo Rouvier and Associates. The survey of 550 people in Greater Buenos Aires had a sampling error margin of 4 percentage points.
Past negotiations have failed. The country's four biggest farm groups rejected the government's May 29 move to trim only the highest tax rates, which applied only if prices significantly soared.
UN Secretary General Ban Ki-moon criticised measures similar to Argentina's at a summit last week in Rome, calling on world leaders to end export bans, tariffs and taxes that he said impede trade and inflate food prices. Argentina argued that subsidies, not taxes, are responsible.
