On the debut day of the agricultural dollar, the Central Bank extended the selling streak and reached 23 consecutive rounds of negative balance in the official exchange market. It was a wheel in which the Doubts about the fine print of the decree of necessity and urgency that launched the new exchange scheme for the countryside.
After the BCRA registered net sales of some US$3,000 million in the first quarter of the year, the worst start to the year in two decades, the Government’s expectation is to achieve a currency settlement through the so-called “soybean dollar 3” around US$5 billion. And, if the expected contribution of the regional economies is added, the estimated figure is around US$9,000 million.
Los Economists suggest that this will temporarily give the BCRA air to recover reserves, but foresee that in the short term there will be more measures to restrict access to foreign currency to reduce the demand for dollars.
Soybean dollar: debut day without settlements
The BCRA registered on Monday a net selling balance of US$99 million. Market sources commented that “half of today’s sales were to attend energy payments“.
In this way, the monetary entity accumulates a red of US$517 million in April and adds a negative result of US$3,573 million so far this year.
Gustavo Quintanaoperator of Pr Cambios, pointed out that “lThe entry into force of the new stimulus regime for the export sector had no impact on the market due to the inexistence of operations registered on that date”.
In the debut of the agricultural dollar, the BCRA was unable to stop the bleeding of currencies, and had net sales of US$99 million
“Some doubts about the operation of the system and the difficulties for its implementation by the financial entities conspired to lead to the absence of business under the new system and, consequently, they postponed for the next few days the evaluation of its result”, he commented, adding: “The BCRA once again disposed of its own resources to meet the unsatisfied demand”.
In turn, the specialist in finance and agribusiness Salvador Vitelli described that the soybean dollar debut day 3 “was improvised, with many doubts, grays and uncertainty that the DNU aroused, which said that the currency settlements were going to be deposited in a linked dollar account.”
“On this debut day, not a single dollar passed through the new segment, the market was completely paralyzed, which made the BCRA end up in a selling position”, he stressed. And he recalled in the “Soybean 1 dollar, the first day was without operations and in the Soybean 2 dollar, $292 million passed through there; it is striking that with the oiled mechanism there are no news.”
However, the expert foresees that as doubts about the fine print are cleared up, “some dollars will be dumped through the soybean dollar and the BCRA will once again be on the buying side.”
the analyst Gustavo Ber He also stressed that “there were no operations under the agricultural dollar, while uncertainty about some details and implementation continues among the participants.”
Reservations: will there be more measures?
Despite the fact that the IMF relaxed the reserve accumulation target for the first quarter of the year by US$3.6 billion, analysts estimate that this corrected guideline would also have been breached. In this regard, the consultant Eco Go It calculated that “despite the adjustment, net international reserves ended in March at US$1.840 million below the new goal, which will make it necessary to request a waiver.”
The agricultural dollar started this Monday, but on the first day there was no currency settlement through this mechanism
“In addition, this leaves a reserve accumulation requirement in the second quarter of US$6.76 billion, which also looks very high,” he said.
Likewise, the consultant estimated that “the agricultural dollar could liquidate foreign currency in the short term between US$5,600 and US$7,400 million, of which the BCRA would be able to retain between US$3,300 and US$4,900 million” with which he stressed that “only in the maximum values would the BCRA be able to fulfill the goal of the agreement with the IMF”.
For its part, a report Gold Values calculated that “at current prices if between 6 million (estimated stock of “old” soybeans) and 12 million tons (an additional 6 million new soybeans equivalent to 25% of this year’s production according to estimates from the Stock Exchange) were liquidated, Cereals) the accumulation of net foreign exchange would not be enough to achieve the target of net reserves committed with the IMF for June”.
Pablo Repetto, jThe head of Research at Aurum Valores maintained that with the agricultural dollar “there will be an inflow of dollars but I don’t think they will be enough to make a significant change in expectations because what is simply going to happen is an advance of dollars that will not later They will be received in the coming months.
“It is a short-term palliative that will also generate a significant monetary expansion. The situation will continue to be precarious enough that there will probably continue to be difficulties for importers to access the dollars committed in the terms that were established at the time. enabled”.
In turn, a report from the consultant LCG he evaluated that “possibly the differential dollar cannot bring relief to compensate for the lower income of dollars due to lower agricultural exports.” And he evaluated that “more measures on the restriction of access to foreign currency are to be expected; mainly we see as something feasible that access to the dollar be restricted even more for the payment of private debt and outbound tourism.”
In the market they foresee that there will be more exchange measures, such as raising the exchange rate of some services such as tourism
The consultant 1816 agreed that “beyond the special exchange rate for agriculture sooner rather than later, Argentina will also raise the exchange rate of some imports of goods and services so that the adjustment of purchases abroad does not depend exclusively on a higher stock”. And they added that “we do not rule out that at some point in 2023 the BCRA tightens the restrictions on companies to pay external debt.”
Of the same diagnosis, an analysis of Facimex Values stated: “Our base scenario contemplates that the Government will seek to cushion the collapse in the supply of dollars by combining three tools: adjustment of quantities by restricting imports, price segmentation via differential exchange rate schemes or making certain imports more expensive, and postponement of payments forcing the accumulation of commercial debt”.
In this regard, he stressed that “The Government has already been forcing the accumulation of commercial debt enough, deferred import payments have already represented more than 80% of import payments in the last 12 months and it is likely that the economic team will seek, at least, to sustain these levels” .
Also, a report from GMA Capital He predicted that “the oasis that may exist in the coming weeks in terms of foreign exchange will surely contrast with an arid desert, enhanced by the drought, later on.”
“And if the dynamics (of currency bleeding) of this first quarter were repeated but in the run-up to the elections, the BCRA will be besieged by the demand for commercial dollars if the exchange rate gap remains around 100%. The antidote , also painful, is to continue tightening the stocks and punish an economy whose recession could exceed 4% just due to the effect of the drought”.
Likewise, Ber judged that “beyond the fact that during the validity of the agricultural dollar reserves should accumulate, I believe that New measures on demand will soon arrive (possibly imports and tourism) in search of maximizing the accumulation of foreign currency during this stage, since later -in a pre-electoral period- the foreign exchange drain would resume.
