Apr 04, 2023

Grain Inspectors Strike in Argentina, More Labor Unrest Expected

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Labor unrest at this time of the year is a common occurrence in Argentina especially as inflation soars and workers lose buying power. The National Grain Inspectors Union (Urgara) initiated a strike late last week as they demanded higher salaries to compete with inflation that is now approximately 100%.

Urgara is an association of technicians that inspect stored grain and gain scheduled for export. A prolonged strike could impact exports from Argentina which is the largest exporter of soybean meal and soybean oil and third largest exporter of corn. The length of the strike is open ended.

This is the first of what is expected to be numerous work stoppages by workers at soybean crushing plants, dock workers, and other labor unions at Argentina's ports and export facilities. Labor contracts in Argentina are usually for a one-year period due to the high inflation and every union will be demanding huge salary increases just to keep pace with inflation.

Individual work stoppages usually do not last very long in Argentina because the government steps in and orders striking workers back to work while negotiations are ongoing, but this year may be different. Workers are suffering under the worst inflation in years and they will be demanding huge salary increases just to keep pace with inflation.

This will put crushers and exporters in an unpresented situation. The government just announced a new "soybean dollar" program designed to spur soybean exports at the same time that crushers are expected to import record amounts of soybeans so they can meet their commitments for soybean meal and soybean oil. While at the same time, Argentine farmers are expected to harvest the worst soybean crop in two decades due to the worst drought in 60 years. It remains to be seen how these conflicting situations are resolved.