Argentina is also facing huge economic issues and the government in a concession to get things moving is in constructive negotiations with farmers to end the strike of grain movement. The latest news release is a 2-tier system that changes the current 35% export tariff across the board. In the new agreement, small producers would get an 8% break to make the new tariff 27% and large producers would still have to pay the 35% but would get a 5% rebate back that can be used for fertilizer, seed, and other farm related items. If the new tariff scale is agreed upon, that would release a lot of pent up soybeans into the world export market.
Interesting to note that Aventine Renewable Energy out of Pekin IL issued a press release looking for immediate capital to stave off filing for bankruptcy. If Aventine does not make it, that would be the end to all 3 big publicly traded ethanol companies. VeraSun and Pacific Ethanol have already filed and gone through the process of bankruptcy, obviously not a great sign for expansion of ethanol plants on the public sector.
Scott Meyer
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