Argentine Truckers Strike

March 19, 2012 06:20 AM

What Traders are Talking About:

* Argentine truckers strike. Argentine truckers started an indefinite strike at midnight over demands for higher transport rates, a new trucking fleet and better working conditions at ports. Leaders of the truckers union are scheduled to meet with Argentina's ministry of transport today. With Argentina's main grain shipping season just around the corner as harvest activity starts to pick up, a quick resolution to the trucker strike is needed or grain exports will be impacted. Argentine dockworkers returned to work last Wednesday, but could go on strike again if port managers don't meet their wage/working condition demands by March 24.

The long and short of it: With both truckers and dockworkers making labor demands, there appears to be greater-than-normal odds of some shipping delays at the start of Argentina's main grain shipping season.

* Warm and wet this week. The warm, windy and dry conditions that produced record high temps for many areas of the country's midsection last week are expected to be replaced by warm and wet conditions this week. Areas of the western Corn Belt are forecast to get 2-plus inches of rain. Slightly lesser amounts are likely across the eastern Corn Belt. Meanwhile, dry areas in the Central and Southern Plains got precip overnight and the rains are expected to continue into mid-week.

The long and short of it: The rains are needed across the Plains and western Corn Belt, especially after last week's unseasonably hot conditions.

* Southern Brazil to remain dry. Rio Grande do Sul in far southern Brazil is forecast to remain hot and dry this week. With the soybean crop in this area remaining stressed, it's likely some private forecasters will further lower their Brazilian soybean production estimates. Meanwhile, conditions are forecast to be generally favorable for late-developing crops and early harvest efforts in Argentina.

The long and short of it: As long as the soybean crop in southern Brazil remains stressed and crop estimates continue to decline, downside risk in the soybean market is limited to mild profit-taking.


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