Situation/weather: The farm is in good shape, recovering from the intense drought all the region faced earlier this year (particularly intensive in Salta region from December to January where generally rainfall occur and boost pastures).

Water availability is key for the breeding and fattening activities we are performing at the farm, not only to cover the daily basic needs of the animals but to ensure dense pasture which enhance ultimately beef production. Over the last 4 years, we have registered a water deficit of around 15% compared to the annual historical average. To this aim, we are analysing the possibility to reactivate and reuse the pressure pipes of an old water tank.

Our second biggest challenge at the farm is the permanent control of the natural vegetation which is typical for the region of Salta (a formerly forest area with a subtropical highland climate). Given the size of the farm, we are working in small-sized lots using a combination of chemicals or machinery/manual clearing to maintain the land.

Cattle operation: We have currently over 2,800 heads of cattle at the farm and working on the increase of the density per hectare of animals. However, lack of rain and high temperature registered (35°C or more) on the previous cycle have affected pastures coverage and livestock watering (on average, we need around 60 litters of water per day and per animal).

Our objectives is to have 2,000 breeding cows by keeping young female calves to increase and replace the herd of mothers, and focus on heifers breeding to achieve a 88% pregnancy ratio with 80% of weaned calves.

For this cycle, we are also planning to sow by ourselves 100 ha of corn and another 100 ha of soybean by a third party and where we are going to collect a lease rent in kind to cover protein needs of the herd. Finally, we have postponed our planned cattle sales waiting for price adjustments.

Just 2 months after having closed an agreement with the IMF, President Macri announced on 08/29/18 in a televised address that Argentina has asked for an early release of a $50 billion loan from the IMF ” to guarantee compliance with next year’s financial programme ” as crisis worsens and was trying to negotiate changes in terms as inflation and GDP targets are not going to be met this year. 

Macri said that in the past week there had been “expressions of a lack of trust in the markets” about Argentina and that “This decision aims to eliminate any uncertainty”. The Peso had already lost more than 40% of its value against the US dollar this year and inflation is rampant (over 30% per year).

After his speech, the Peso fell again to close at an all-time low of ARS 34.2 per US dollar. The next day, Argentina lived his “jueves negro” (black Thursday), where the US dollar continued his flight to exceed the historical threshold of 40 pesos (with a peak at 41.7) before the Central Bank raises in emergency its interest rate from 40% to 60% (the highest level in the world) to contain the devaluation.

For the first time in history, the Argentine peso is worth less than the Uruguayan. Everyday life is getting more expensive for Argentines, as the prices of many goods and services still bear a close relation to the US dollar. Furthermore, the combination of spiralling inflation and public spending cuts means wages are not keeping pace with prices, making most people poorer.

Other emerging markets such as Turkey and Brazil are also suffering from the devaluation of their currencies this year, but Argentina’s situation is particularly troublesome and will also have ripple effects for the neighbouring countries.

After having reached a peak end of June (above 29 ARS/USD), the peso seems to have stabilized around 28 per USD thanks to the 3 increases in minimum reserve requirements made by the B.C.R.A. (June 18, July 2 and July 18).

Regarding inflation, that’s another story: Monthly inflation was 3.7% in June (the strongest monthly hike since 2 years) and 16% over the cumulative first six months of the year. In comparison with the month of June 2017, prices rose by 29,5%. Housing prices, water, Electricity, gas and other fuels have increased by 48.5% year-over-year. 

Meaning that national inflation rate targeted for the year by the B.C.R.A. (15%) has already been exceeded over the first six months of the year.

Situation/weather: Even if more rains have been registered in Corrientes province since March, damage causes previously by the drought could not possibility reverse, especially for crop activities as water is required at given time. As of end of May, cumulative rainfall for the cycle was 1,120 mm or -20% compared with the historical average for the same period.

Cattle operation: Our cattle herd (5,412 heads currently) is in good conditions and the more sensitive categories to high temperature have started to recover. Young male calves are going to be send to San Bartolo farm where fattening process is easier and faster than in Curupi Pora given Salta’s climate. Young female calves are retained to increase and replace mothers’ herd. Self produced Bradford bulls will also improve internal genetic of the herd while old bull are going to be sold.

As we were able to access to the limit of the farm bordering with Santa Lucia river, we took advantage to put fences in place to segregate the floodplain in order to graze cattle on the unfloodable section as pasture are very dense there.

Argentina reached a three-year deal with the International Monetary Fund (I.M.F) on Thursday 06/07/18 for a $50 billion credit line, an amount that was larger than expected, which the government promoted as a vote of confidence on its market-friendly reforms.

Argentina requested I.M.F. assistance on 05/08/18 after its currency weakened sharply.

I.M.F Managing Director, Christine Lagarde, said the fund supports Argentina’s plan to try to cut its budget deficit and bring down soaring inflation.

Four months after the announcement of an agreement to increase and diversify Argentine meat exports to China, after 15 years of negotiations, the governments of both countries announced the approval of the final protocol during the visit of the Argentine Minister of Agriculture, Luis Etchevehere, in China.

China with the European Union are the main recipients of Argentina agro-industrial exports. According to Argentina’s Agro-industry Minister , China is Argentina’s main meat export market with 50% of meat exports going to China in 2017, worth some $405 million.

Argentina’s central bank has raised interest rates for the third time in one week as the peso, continues to fall sharply.

Over a month, the value of the peso has melted by about 10%, mainly due to the rise in US treasury bill rates. This forced the Central Bank of Argentina on  May 4, 2018  to raise interest rate to 40% (the highest level in the world). By raising its rate, the central bank is trying to convince Argentineans to invest their money rather than buying dollars, a safe haven when inflation is high.

Argentina seeks $30 billion from the IMF to calm markets and to help to stabilise economy. President Macri has begun talks on a financing deal with IMF Director Christine Lagarde on May 8, 2018.

“Article from the Financial Time, dated 5/11/18”

Earlier this month, the Central Bank (BCRA) had to sold massively USD in the spot market to halt peso weakening after the USD quote fell to a record of ARS 20,65.

The BCRA is concerned about the impact that the weaker ARS can have on the already very high inflation. National inflation is now expected to be 15% at the end of the year while a range of 12% to 17% was targeted previously. Economists are more septic about and they expected an inflation of 20% minimum.

 According to the National Statistics Institute (INDEC), national consumer prices rose 2.4% over the previous month in February, coming in above January’s 1.8% rise. However, the increase was expected due to a hike in prices of electricity, transportation, communication and medicine that came into effect on February 1, 2018.