Time To Cry For Argentina?

It's all gone wrong for Argentina, the eighth largest country in the world, the fifth largest exporter of wheat in the world just two years ago, and the world's largest consumer of beef per capita.

Crippled by drought, inflation, punitive taxes and crippling red tape the agricultural sector has gone to the dogs.

Amid raging inflation the government of President Cristina Fernández de Kirchner is trying to control food prices by sporadically preventing their export. and what is allowed to leave is being taxed to the hilt.

In the grip of the worst drought the country has seen for 70 years, coupled with an acute lack of credit, farmers are scrimping on fertilisers to replenish the soils they plunder.

Already expected to plant the smallest wheat crop since records began a hundred years ago, the Buenos Aires Cereals Exchange warn that plantings are likely to fall significantly lower than their most recent estimate of 3.2 million hectares.

In 2008, for the first time ever, Argentina exported less beef than Uruguay, despite being almost fifteen times bigger.

One farmer interviewed by the Scotsman said that the country is expected to have to import beef as from 2011, and will only have enough wheat to cover internal consumption next year – and that is only if it starts to rain.

"Even if it does rain, most farmers are looking at alternate grains such as oats, barley and any other product that does not involve an export tax," he added.

"The country considered to be one of the breadbaskets of the world is falling towards international oblivion."