The government will grant soy exporters direct access to 25% of their dollar earnings, which can only be used to purchase soybeans for processing, according to a decree published on Tuesday morning. The measure will run throughout September.

The scheme, designed to incentivize producers to export, is not a beneficial exchange rate, unlike past versions of the Export Increase Program (PIE), as it is officially called.

Exporters in Argentina are required to convert all their export earnings into pesos at the official exchange rate, which is currently frozen at AR$350 until October. However, the wide gap between the official rate and the financial exchange rates often prompts producers to hold stock in expectations that the official rate will decline.

The measure, which comes as Argentina faces an acute shortage of dollars that is limiting its capacity to import, aims to incentivize producers to sell and, therefore, bring dollars into the country.

According to the decree published in the Official Bulletin, 75% of export earnings will enter the country in dollars and be liquidated in pesos at the official exchange rate. For the remaining 25%, exporters will be able to access dollars (without exchanging them for pesos) but only if they use those dollars to purchase soybeans to produce oil or pellets.

The Argentine Oil Industry Chamber (CIARA, by its Spanish acronym) and the Cereal Exporters Center (CEC) said that each company will decide individually whether they wish to enter the program. In past versions, the decision was taken collectively by all chamber members.

“As an industry, we believe that exchange rate unification is the best policy, as well as eliminating all restrictions [like export duties for agricultural products] in order to really be an agro-exporting country that considers the integral benefits of each and every one of the sectors that make up this big [production] chain,” they said in a press release.

In order to account for export duties, producers will have to make an advanced payment. The basis for this payment will be a percentage of the 75% of their earnings that are earmarked to be exchanged for pesos in the official market. The deadline to pay for these export duties is September 28.

In a prior version launched last April, agricultural producers were able to export soybeans and other soy products, as well as regional agricultural products, at AR$300 to the dollar. Tthe official exchange rate at the time was AR$214. A differential exchange rate for agricultural products launched last July amid tough negotiations with the International Monetary Fund and a sharp drop in international reserves did not include soybean producers.  

The agro dollar, or PIE, was originally launched on September 4, 2022, aiming to strengthen international reserve accumulation through exports.