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PARAGUAY – Progress made in land preparation at Salitre Cue farm (August 2020).

Posted on by Campos Orientales

We made good advances in land preparation: over 1,000 ha have been fully prepared now (tillage, land levelling, field drainage and aerial application of herbicide). Our objective for the cycle is to sow in partnership our so called “base” surface of 1,600 ha and the production will be dedicated 100% to IRGA 424 cultivation. We choose not to extend our planted surface given all market interties (slow trading activities, Brazil situation and pandemic situation).

We are going to sow again in stages this cycle and we are targeting to start the sowing of 1st stage by August 25 (540 ha). This way we can have a harvest in stage and reduce our operating risks (weather issues and irrigation restrictions) while we will have a better control of the plots as they are not going to be all in the same stage at the same moment.

Fertilizers were delivered by our partner at farm and stored in our facilities.

We are also in the final stage of the maintenance of our water pumps. The entire process has been delayed due to the pandemic (limitation of circulation of service providers, delays to import spare parts, etc).

On 2 of the 4 big pumps at the river water pumping station (each with a 2,600 liter flow per second), power and control cables had to be replaced given the intensive use of our pumps. Those cables are key but their imports were delayed. Those pumps are going inside a pipe with those cables and have then to be installed with a tensioning steel cable to prevent movements’ function that when water creates turbulence inside the pipe, cables have no movement and they don’t hit the pipe walls.

To proceed, we need 1st to remove the pumps from their pipes. It s a very technical process because If water reaches inferior place, pump needs to be treated in lab conditions (dismantled and all inside water needs to be removed; likely bearings will also need to be replaced). At the re-pumping station, the smaller pump there (1,600 liter flow per second) needed a much lighter maintenance, only small spare parts had to be changed. The costs of maintenance can rise very quickly if you don’t pay attention.

ARGENTINA – Update on Curupi Pora farm activities (August 2020)

Posted on by Campos Orientales

Situation/weather: While Government extends lockdown in the Buenos Aires metropolitan area (AMBA) until August 16 and prohibits all social gatherings in Argentina for the next 15 days, more flexible measures have been applied in most of Argentina’s 23 provinces. The AMBA region is concentrating 90% of all cases of covid-19. However, movement restrictions are still prohibited between provinces for non essential services which are creating troubles for them. For us, advisors or providers like vets cannot visit all our farms as they are located in different provinces.

In addition, weather is not help us and we are concerned about drought situation we are facing at the farm. No rain occurs and wide daily fluctuation in temperature are registered (8° C in the morning vs 29 to 34°C in the afternoon) which affects re-growing of pastures. In some part of Santa Lucia River, we register only 20 cm of water, and its winter/raining period…

Cattle operation and pasture program: We have currently above 6,400 heads at the farm. Given the weather conditions we are facing, the cattle is overall in good shape.Cattle video

We are just starting 1st grassing on ray-grass sowed in May. The pasture is missing rains.

Here you can see OAT emerging sowed earlier this year (same status as ray-grass) as well as heifers 2 years which will start service in October/November.

We also installed a new solar water pump at one of our water tank.

ARGENTINA – Debt restructuring deal reached with creditors (04/08/2020).

Posted on by Campos Orientales

Argentina’s government announced on Tuesday 4 it had reached an agreement with its principle creditors to restructure more than $65 billion in foreign debt following seven months of negotiations and shifting deadlines.

The deal with key creditors like BlackRock Inc, Ashmore Group Plc, and Fidelity Investments would provide “significant debt relief” by adjusting the dates of payments without raising the total amount of capital and interest to be paid. The government of Mr Fernández didn’t provide a net-present value for the agreement, but sources close to the case are saying the deal is worth about 54.8 cents on the dollar. Argentina’s last offer was worth 53.5 cents per dollar while creditors request 56.5.

President Fernández must now turn his attention toward the I.M.F. as the country looks to resolve issues with its senior creditor and replace the failed financing arrangement signed under Macri’s administration in 2018. He must also focus on reigniting an economy that has been shuttered for months, and sparking growth as the country braces for one of its sharpest economic contractions on record (13.5% decline in gross domestic product according to Bank of America forecast).

ARGENTINA – Clearing performed in Tata Cua forest (August 2020).

Posted on by Campos Orientales

We are currently performing some clearing activities of pine trees (culling and thinning).

This work allows, in a very dense stand produced from seedlings, to remove a certain number of “young plants” or wild re-growing plants, to promote the growth of futures crop trees.

In general, the first clearing is done in the third or fourth years after planting and the second clearing is carried out between the fifth and the seventh year. Our 750 ha forest is planted with pine trees, eucalyptus and grevillea trees.

ARGENTINA – Debt deal at impasse as creditors unite to reject government’s offer (July 2020).

Posted on by Campos Orientales

Three groups of creditors have announced on Monday 21 that they have rejected Argentina’s proposal to restructure $65 billion of debt and delivered a counter offer to government – which President Alberto Fernández promptly dismisses out of hand. “We have made a possible offer and it is impossible for us to move from this last effort, which is a very, very big effort,” said President Fermandez in a statement delivered on TV Pública.

Argentina’s last offer was worth 53.5 cents per dollar, a significant improvement on its original starting position of 39 cents. Having originally proposed a 3 year grace period, the offer reduced that to 1 year, with repayments beginning in September 2021.

Creditors’ groups, however, dismissed the idea that there wasn’t more room for negotiation. “Argentina’s offer is short of what the creditor groups can accept,” they said in a statement, adding that they would not meet the government’s August 4 deadline to find an agreement. To be continued …

PARAGUAY – Advances in land preparation at Salitre Cue farm (July 2020).

Posted on by Campos Orientales

After having registered 10 days of dense rains, we restarted with land preparation activities. After a drought period, a small rain can helps land based work but not 10 days of continues dense rains. However, with machinery operating at full power, we will very quickly catch-up and we have already prepared over 600 ha so far. The good news, is that those rains helps the fully naturally our reservoir as we need full water capacity for the coming irrigation period of the cycle.

According to the latest weather forecasts, we should register heavier rains than it use to be for the season and that until mid august. Then, the situation should progressively reverse from September onwards (below normal, especially in the spring). Temperatures are going to follow the same trend (below average until mid August, than the averages). Experts are predicting La Niña phenomenon for this season on our region. Therefore, current rains help reducing pumping costs to fully the reservoir but will also be useful during irrigation period of the fields, and engines have to work full capacity during the days it doesn’t rain to be ready for sowing stage.

We are taking advantage of the good weather to aerial spray the fields with herbicide to control the weeds as you can see. All those work will make root penetration easier, and facilitate irrigation and drainage. It improves weeds and crop residues distribution the field so as their control, and incorporate them into the soil.

ARGENTINA – New extension on debt talks and peak virus period (July 2020).

Posted on by Campos Orientales

President Fernandez has announced a further extension of debt negotiations deadline until August 4.  It’s now the fifth extension but Argentina needs to reach an acceptable compromise to restructure more than $65 billion of debt. The country is already in technical default since May 22 after failing to make its $500 million interest payments due. According to local news, it seems that 2 groups of creditors are whiling to accept the latest offer made.

Meanwhile, the country seems to reach the peak of the pandemic: 75 deaths have been registered on the single day of July 6 and 2,632 new cases declared. More than 80,000 people have now been infected with Covid-19 in Argentina. Over 90% of all confirmed cases are in Buenos Aires metropolitan area where around 14 million people live. Restrictions have been enhanced again like access to Buenos Aires city, public transportation, etc.

Latest news: President of Brazil, Jair Bolsonaro, has been declared positive to covid-19 on July 7. Since the beginning of the pandemic, he minimizes illness and participates in several public events without wearing a mask. He was strongly criticizing isolation measures implemented in several states to reduce the risk of disease spread. He said that his history as an athlete would protect him from the virus, and that it would be nothing more than a “little flu” were he to contract it. He might change his position now.

PARAGUAY – Land preparation has started at Salitre Cue farm (June 2020).

Posted on by Campos Orientales

We have begging on June 22 with initial land preparation work of the fields. This cycle, we planned to sow 1,530 ha with rice in association with a local landing seeds and agrochemical family group. We hope that you will have at least the same level of production results. For the past cycle, we have got 8t/ha as yield with an average index quality of 55. We produced over 12,000 tons of paddy rice and our silos are now empty.

In terms of sales, we notice that rice prices have well increased in May due to exports to Africa and Pakistan. The situation was driven by food securitization fear of those countries due to Covid-19 pandemic. On the opposite, Brazil almost disappears this cycle in terms of rice import from Paraguay (generally 90% of Paraguayan rice production is exported to Brazil) but they are also not exporting they own production. Covid-19 pandemic has created fear and panic on food supply chains.

We continue to follow sanitary recommendations and strict protocols to ensure our employees and contractors’ the saves work environment possible.

For now, our attention is focused on land preparation which is important to ensure that the rice field is ready for planting. It is also creating a favourable environment for the rice plants to germinate and grow.

A well-prepared field improve soil structure (better ventilation, permeability, and loosening of the root zone) to make root penetration easier, and facilitate irrigation and drainage. It improves weeds and crop residues distribution the field so as their control, and incorporate them into the soil.

All our contractors are at farm and are starting their activities after filling their machines with gas.

ARGENTINA – Debt talks hit a wall, and Agriculture sector is lobbying (June 2020).

Posted on by Campos Orientales

Talks to restructure more than $65 billion in foreign debt seemed to have hit a wall as one of the main groups of bondholders is now evaluating his option to seek repayment in the courts. Officials and creditors failed to find common ground after 2 bondholder groups submitted an offer before the latest deadline. Argentina has set a deadline of June 19 on its latest proposal after extending it 4 times, but the deadline doesn’t have tangible impact since the country fell into default on May 22 after missing overdue interest payments of $500 million (please refer to previous posts).

As tensions mount, the government is considering all possible options, among them asking the International Monetary Fund for a new programme sooner than previously planned or using payments tied to agriculture exports. Farmers are lobbying against Economy Minister’s Martín Guzmán proposal as “A measure like this would mean export taxes couldn’t be scrapped until the bond matures”.

The farm industry is key for tax revenues and to bring in dollars: Argentina’s crop exports were valued at $23.7 billion last year.

President Fernández hiked export taxes already 6 months ago when he took office. More recently, the central bank has taken steps to prompt farmers to sell their soy harvests. Dual foreign-exchange rates are also driving concerns about input prices which are becoming very expensive, and we previously talked about Vicentin expropriation. Ultimately, authorities are trying to manage farm products exports and to get their dollars. What comes next…and for now, the new deadline has been set for July 24.