Soyoil prices in the world’s largest exporter have fallen 30% since the start of the year to $557.25/FOB Up River as edible oil and biodiesel demand plunged due to the Covid-19 pandemic. On top of that, Argentina has been plagued by low water levels on the Parana River, which connects the Rosario export complex to global markets. The hub handled 93% of all Argentina's vegoil exports in 2019, further damaging the limited demand that there was.
The Association of Automotive Factories (Adefa) reported on Wednesday that, during April of this year, no vehicle production was recorded in Argentina. In total, the sector exported 2,386 vehicles, or 82.9% less compared to the previous month, and 88.4% below the volume that was counted in April 2019. In the cumulative of the first four months, exports fell 37%. In wholesale sales, the automotive sector marketed 7,512 units to the dealer network, which stood 60.3% below the previous month's performance, and contracted 73.6% compared to April last year. In the cumulative January-April, 35.3% fell sales.
The Argentine government said it is open to new proposals from its bondholders to restructure a $65 billion debt, indicating a greater willingness to negotiate to avoid another chaotic default. Large groups of creditors have already rejected Argentina's first proposal, which includes accepting a 5.4% reduction in capital, a 62% cut in interest payments, and a three-year grace period. If no agreement is reached before May 22, when a grace period for bond payment ends, and Argentina decides not to pay, the country will default.
After testing levels close to 120 pesos and a gap of about 80%, stock dollars interspersed a respite on Wednesday and dropped to 1.46 pesos, despite increased dollarization in response to the caution and uncertainty generated by debt restructuring, rising monetary issuance, and negative real rates. However, with new currency trading hurdles on the market, pressure did not drop on the parallel market, where the blue dollar jumped another 2 pesos and scored a new all-time high.
Industrial production and construction plummeted in March in Argentina, 16.8% and 46.8% respectively, compared to the same month in 2019, as part of the quarantine imposed to prevent the spread of COVID-19, the Indec Statistics Institute reported on Wednesday. In the cumulative first quarter of this year, the industry fell 6.4% and construction 28.1%, compared to the same span last year. Compared to February, industrial activity lost 1.1% and construction 32.4%.