Argentina: Barley prices benefiting from steady presence of feed barley demand from Saudi Arabia

There is strong underlying support for barley prices in Argentina, led by a steady presence of demand for feed barley from Saudi Arabia where recent trade for immediate shipment has been reported. As a result, both FOB & FAS prices are higher, as this feed demand arrives while farmers are not selling due to being busy with the on-going sunflower harvest.

There remain a number of logistical challenges resulting from the severe flooding in the south of Buenos Aires province, but the situation is improving. The Argentina government still has an IMF loan negotiation to resolve, and speculation persists regarding a possible peso exchange rate unification, whereby the unofficial exchange rate is eliminated. Also, farmers anticipate at some stage the export tax regime would be adjusted (lowered) to the benefit of farmers. At the moment most of these major changes are speculative.