Representative image of Milei generated with AI
In a surprise measure, the government of Javier Milei announced a temporary suspension of the export taxes on grains, agricultural by-products, beef, and poultry, with the aim of accelerating foreign currency liquidation and stabilizing the peso amid strong economic tension. The measure, published in the Official Bulletin, will last until October 31, 2025, or until reaching a quota of 7.000 million dollars in declared sales.
The situation is critical: following electoral defeats of La Libertad Avanza in some provinces, the wholesale dollar hit the ceiling of the exchange rate band, forcing the Central Bank to sell more than 1.000 million dollars in three days to contain the rise. This decision seeks to help reserves by encouraging the agricultural sector to liquidate at least 90% of foreign currency within three business days, under penalty of reversing the benefit.
The innovation lies in the communication: presidential spokesperson Manuel Adorni first shared it on social media, before its officialization, to generate immediate impact on exporters and markets. The scheme includes crops such as soybeans, corn, wheat, barley, sorghum, and sunflowers, with previous rates of 26% for soybeans, 24.5% for soybean oil and flour, and 9.5% for corn. Analysts highlight that it could boost sales, especially ahead of the planting of the next season.
Reactions were immediate. Markets responded with rises in bonds and stocks, a slight decrease in country risk, and strengthening of the official and parallel peso. Organizations like the Argentine Rural Society celebrated the relief but criticized its temporality, arguing that it reduces predictability and could saturate supply without raising prices. The sector is asking for a permanent removal, seeing it as a "band-aid" in the urgency for dollars.
However, it is a dangerous move: it implies a fiscal loss estimated at 1.500 million dollars this year, and its expiration raises doubts about the future tax scheme. If exporters do not respond at the expected pace, exchange rate pressure could resurface, exposing structural fragilities. For Milei, one month before the legislative elections, this measure is a trial by fire: a temporary respite or the beginning of a bolder strategy to restore the economy.
What do you think of this measure?
Should it be a permanent suspension?
How much do you think this measure helps ahead of the elections?
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