Argentina Creates New Gov’t Agency to Manage River Grain Cargo; Farmers Wary of Bureaucracy

Argentina is the world’s number three corn exporter, and top supplier of soybean for hog and poultry feed across Southeast Asia and the EU, with the country’s Paraná Paraná River responsible for carrying about 80 percent of the country’s grain exports from the Pampas farming belt to the coast.

For years, cargo ships paid tolls directly to the private dredging company charged with keeping the river open for cargo transportation. However, the Argentinian government has announced the formation of a new agency that will now manage dredging operations.

The National Ports Administration has been granted authority over the next 11 months to subcontract management of the waters, while the transportation ministry examines bids from dredging companies for the long-term. The tolls paid to this chosen company will then be collected by the newly established agency.

Those in the industry are concerned that government intervention will translate to greater bureaucracy and higher costs to be shouldered by the grain sector - the country’s main source of hard currency. This is the latest development in a long-standing opposition by farmers and exporters against government intervention in the industry who are worried that tolls being processed by the state would dilute outcomes and increase dredging costs.

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