Soybeans, financial crisis and Mother Nature

      Things take place dialectically, by means of intricate entwining relationships, and that is certainly the case in Argentina, whose business and agriculture have been and still are dominated by powerful economic groups--more interested in profits than in the protection of the environment. The case of the soybean boom is a case in point. In the context of the present confrontation between the government of President Cristina Fernandez Kirschner and agrobusinesses and farmers, it is important to point out that it was the State that back in the 1960’s and 1970’s stimulated the growth of soybean, considering its great emerging market especially in Asia.

     Those who got on the bandwagon rapidly and with the experience and financial resources necessary to take advantage of the new export item were multinational corporations such as Cargill, Monsanto, Dreysus, ADM and Bunge. They not only began to buy up vast extensions of agricultural lands in northeast, frequently a the expense of small farmers and native forests; they also installed some of the world’s biggest cooking oil plants and pressured the State into dragging the Paraná river, necessary for the subsequent construction of private ports for the export of soybean products.

    Soybean products are rarely consumed in Argentina, although they are a dietary staple in Asia. In the United States soybeans are used mainly as grain for animals. One of the main firms associated with the boom was Montsanto, which has strong ties with Cargill. It based its spectacular growth in Argentina on the use of the RR "glifosato" seed, bytracking some of the restrictions and annual payments in force for its use in the U.S. Not only the seeds: also the pesticides used to facilitate the growth of the plants free of insects. Thus, Argentina became a sort of "guinea pig" for soybean and it worked very well...at least until the present crisis combining demands on the part of producers for export tax reductions, the dramatic drop in prices on the world market due to the financial crisis and the dry spell and climatic conditions now affecting agricultural lands in Argentina.

    Suddenly the soybean boom seemed about to burst at its seams.The government proposed a flexible scheme of export taxes, increasing or decreasing them in accordance with the ups and downs of prices on the world market. The agribusinesses shouted back and dragged along some of the medium size producers, blocked roads and organized a national lockout. Then along came the world’s financial crisis--caused to  a great extent by over speculation by financial interests and those who had had a heyday with the lax controls of the Bush Administration in the U.S.A.  Prices dropped dramatically, giving producers another argument to demand elimination of taxes. But before anything important came of that, along came Mother Nature, helped out by shortsighted men: one of the country’s worst dry spells affected not only the newfound gold (soybean) but cattle and many other aspects of Argentina’s agricultural production.

    According to debate in the press and in political circles, the dramatic dry spell in areas of intensive soybean production, plus the floods in the northern western part of the country, are in part an after-effect of deforestation and the lack of a long term plan for biodiversity--although important also is the general process of  warming up of the globe caused by the excessive emission of toxic gases and disconcern for the preservation of the world’s ecology. Thus, the financial  crisis and the dry spell have put a big dent on the soybean boom. Although many powerful agribusinesses talk about organizing another lockout to eliminate export taxes, they also realize that such an action in the context of the dramatic meltdown of economic factors around the world...could end up in contradiction to their own interests.

   There is thus a clear interrelationship between the encourgement of the State for a boom de-emphasizing or phasing out other agricultural activities and a social-economic crisis concerning the direction the countr’s development should take...and the ravages of destruction of the environment through the destruction of native forests and stimulation of de facto  monocultivation--actions which additionally produce great damage to indigenous peoples who traditionally live in or on the edges of the forests. It is as if the State had produced a monster which it then vainly attempted to control. These actions nevertheless affect everyone directly or indirectly.