Argentina's new export duties offer relief to agricultural supplies: sources

Argentina's revised export duties on key agricultural commodities like corn, soybeans and byproducts are expected to ramp up exportable supplies, increase producer margins, and ease price volatility, according to market sources.

President Javier Milei announced a "permanent" reduction in export duties from 12% to 9.5% for corn, while lowering the duties on soybeans to 26% and soybean byproducts to 24.5%, from 33% and 31%, respectively. Export taxes on beef were reduced from 6.75% to 5%.

"This is a very important measure for the domestic market," said Javier Preciado Patiño, agronomist and former undersecretary of agricultural markets at Argentina's Ministry of Agriculture. "The tax reduction improves the price of soybeans for farmers and pulls farmer selling."

At an event on July 26, Milei said the reductions were permanent and would not return while he is in power. This was less than a month after he reinstated higher export duties on key agricultural exports on July 1, which was preceded by a period of rapid farmer selling and outflows.

In the year to July 20, Argentina's combined exports of corn stood at 21.9 million mt, with Vietnam accounting for the highest volume (3.7 million mt), followed by Peru (2.5 million mt) and Malaysia (2.3 million mt), according to S&P Global Commodities at Sea.

In the same period, soybean outflows amounted to 3.6 million mt, with the highest volumes going to China (3.1 million mt), Russia (128,343 mt) and Peru (122,533 mt), CAS data showed.

"When the government increased the export tax from 26% to 33% [for soybeans] on July 1, sales declined and there were no more export registrations," Patiño said.

Similarly, of the 14.5 million mt of soybean meal exports in this period, Vietnam emerged as the top destination at 2.3 million mt, followed by Ecuador (921,403 mt) and Italy (905,864 mt), according to CAS.

Argentina's 2025-26 marketing year corn output is forecast at 53 million mt, up 6% year over year, while soybean output is projected at 48.5 million mt, down 2.8% year over year, according to the US Department of Agriculture's Foreign Agricultural Service.

Argentina's MY 2025-26 corn exports are projected at 37 million mt, up 7.25% year over year, while soybean outflows are projected at 5 million mt, down more than 18% year over year, FAS data showed.

Argentina is expected to produce 33.54 million mt of soybean meal in MY 2025-26, up 2.14% year over year, and export 30 million mt, up 3.1%, according to the FAS.

Argentina's corn and soybean marketing year runs from March through February, while its soybean meal is marketed from April to March.

Argentina's beef and veal output in 2025 is projected at 3.08 million mt carcass-weight equivalent, down 3.14% year over year, while exports are projected to fall 8.8% to 770,000 mt cwe, FAS data showed.

Price volatility; tariff-scenario

In the wake of Donald Trump's tariffs and negotiations with key consumer markets, South America is viewed as a reliable and relatively stable supplier.

Together with Brazil, Argentina makes up one of the largest supplies and exportable bulks in the global agriculture and protein markets.

While frequent policy changes, including revisions in export tariffs, drive volatility in exportable supplies and raise questions on reliability, Milei has said the export duties will not rise again.

The reduction in duties "seeks to boost farming, the economy's most productive sector, which has been severely punished by these taxes over the last 20 years," Milei said.

Patiño said: "I believe this new 26% export tax [for soybeans] will not impact FOB prices but will stimulate the export market."

Since July 1, both corn and soybean meal prices have seen a noticeable increase.

Platts, part of S&P Global Energy, assessed FOB corn Up River for loading in September at $200.2/mt on July 25, up $6.50/mt since July 1, when the higher duties were still in effect.

Similarly, Platts assessed the Argentine soybean meal FOB Up River price for September loading at $291.23/mt on July 25, up $3.86/mt since July 1.

Market participants will be watching for price movements in the coming days, with Milei's assurance of a stable policy and expectations of further easing of duties.