Chinese demand for soybean imports has grown for the last 13 years in a row, and Argentina, alongside the US and Brazil, is one of the world’s top three producers. Soybean exports from Argentina are expected to reach up to 9.5 million tonnes in 2017-18 as a result of stable production and higher carry-in stocks, representing a 6% increase from last year.
China is predicted to import 87 million tonnes a year to date (September 2017), according to the US Department of Agriculture, which represents a quarter of the world’s crop. Nearly 90% of Argentina’s soybeans are shipped to China, alongside other important markets like Egypt, Chile, Cuba, the United States and Venezuela. As global demand for meat continues to increase thanks to expansion in the livestock and pork sector, the growth opportunities in the soybean market are clear.
Argentina’s government has moved to support the country’s massive farming sector (soy is the main cash crop) by implementing a new tax reduction plan. That will begin in January 2018 and will see the soybean export tax reduced by 0.5 percentage points each month until December 2019. By then, the soybean and soybean by-product export taxes will be 18% and 15% respectively (the cuts were originally planned to start in 2016 and were delayed as a result of the recession in Argentina, Latin America’s third largest country).
The country has also seen an unprecedented wave of corruption charges over the past couple of years which has seen high-profile individuals, including the former President involved. Such enforcement has led to unwelcome comparisons with neighbouring Brazil, where authorities have been prosecuting the largest corruption scandal in the country’s history.
The ongoing economic and political crisis has, of course, hit local commodities firms, who have turned their attention to downsizing rather than hiring, despite the strong soy market. While the talent in the country is highly skilled, and there is no shortage of English-speaking professionals, there are issues around levels of investment creating employment opportunities.
For now, we see very little recruitment taking place, as the number of positions continues to decline. That being said, the local workforce is in good shape for when the economy recovers. Our advice to local talent is to diversify their skill-set in order to secure employment. Commodities firms historically sought out specialist expertise, however, in today’s market in Argentina they are forced to hire generalists who can cover two or three desks. The greatest demand at present is for individuals who can absorb activities from other departments and sectors as well as meeting the job specification in question.
by Brad Knoxview my profile