Countries left and right are halting exports of key commodities amid the ongoing conflict in Ukraine. And the latest one to announce that it is going to hold on to its resources is Argentina.
One of the world’s largest producers of soy (much of it genetically modified), Argentina has decided to halt all exports of soybean meal and oil, which are used as cheap fillers to produce processed junk food.
A memo signed by Javier Preciado Patino, Argentina’s secretary for agriculture markets, explained that in order to increase control over local farm goods for protectionist purposes, his country will be holding on to its soy products for the time being.
The announcement triggered a more than 2.2 percent increase in soy meal futures, driving up commodity prices even further. Ukraine did much the same thing by halting exports of wheat, corn and other grains.
Since late February, Argentina has intervened in food markets by subsidizing the domestic wheat industry. This is similar to earlier policies it imposed for vegetable oils that aimed to help mitigate soaring costs for consumers.
Experts at the United Nations expect global food prices to increase by eight to 20 percent moving forward.
“The government typically puts a block on the export register, known as DJVE, before increasing taxes on shipments in order to stop farmers from preempting the hike with a flood of selling,” reported Bloomberg, further speculating that Argentina will increase taxes on soy meal and oil to 33 percent from 31 percent.
“The sudden halt in Argentine supplies will steer importers toward the United States and Brazil for replacement supplies,” soy traders told Reuters.
“Buyers have no choice but to reduce consumption or got to alternative sources for supplies,” they added. “We expect higher demand for U.S. meal.
In Southeast Asia, buyers such as Indonesia, Malaysia and Thailand were heavily reliant on the Argentine meal,” noted a Singapore-based trader.
Expert warns that current trajectory is leading to global “great famine”
Russia’s invasion of Ukraine is being blamed for these protectionist measures, which are being imposed not just in Argentina but also all around the world amid record inflation and supply problems.
Steve Mathews, head of strategy at Gro Intelligence, told Bloomberg that protectionist measures like this will further drive up prices due to tightening global supplies.
“It adds greatly to the inflationary concerns,” he warned.
Russia, Ukraine, Moldova, Hungary and Serbia have all banned exports of farm goods, with Russia and Ukraine being two of the world’s top suppliers of commodities like wheat and barley.
Disturbingly, if things continue on with the current trajectory, it could spark a “great famine” all around the world, warned Eric Peters, CIO of One River Asset Management.
“It’s beginning,” wrote someone at Zero Hedge ominously. “Global trade coming to a halt.”
“Argentina is a big agriculture exporter,” wrote another. “This will be a big deal. We are one bad U.S. crop away from planetary deep s**t.”
“Millions dead confirmed,” warned another. “Well, the job is done. Now we get to watch the carnage across the world. What’s interesting is that ALL of what is coming was completely preventable.”
Someone else pointed out that we could be watching hyperinflation unfold before our very eyes, which will lead to a collapse of not just the food system but all fiat currencies backed by nothing and controlled by central banks.
“All of these compounding factors will add up to massive hyperinflation, famine and poverty,” this same person added.
“Let me guess, Brandon will do nothing and U.S. consumers will be left fending for themselves,” scoffed someone else.
More related news can be found at Collapse.news.