To force producers to sell their soybeans, the Central Bank (BCRA) decided to cut their access to financing for the loans launched at 24% to address the current situation of the country amid the coronavirus. The BCRA established that financial entities would not be able to finance human or legal persons with an agricultural activity that maintain a stock of their wheat or soybean production for a value higher than 5% of their annual harvest capacity.
The groups reduce the grace period requested by the Government from three to only one year, include substantially higher returns than those offered, have a “present value” of between 58 and 60 cents on the dollar, and demand reimbursement of all expenses – a critical proposal that is far from the equation presented by the Argentine Government.
In 13 months the BCRA’s reserves decreased by $34.3 billion, from a record $77.49 billion on April 9, 2019. At nearly $43.2 billion, reserves were near last year’s low of $43.1 billion on November 7, 2019. The decline in the level of gross reserves was driven in the previous month by the withdrawal of dollar deposits. Since Monday, April 20, with the quarantine in banks relaxed, $1 billion has left the financial system.
In a new successful exchange of dollar Treasury Letters (LETES) and a remnant of the Dual Bond, the Ministry of Economy managed to reconvert $626 million in exchange for local currency bonds tied to inflation. In this way, the government continues on its arduous path to rebuilding a consistent peso debt market.
The S&P Merval index of the Buenos Aires Stock Exchange rose slightly 0.4% to 39,388.33 units, led by the improvement noted in energy companies. The most significant increases were recorded by Despegar (9.3%), Corporación América (6%) and Central Puerto (5.7%); while the decreases were led by the financial segment, whose shares fell to 2.2%.