VZCZCXYZ0073
RR RUEHWEB

DE RUEHBU #0368/01 0801702
ZNR UUUUU ZZH
R 201702Z MAR 08
FM AMEMBASSY BUENOS AIRES
TO RUEHC/SECSTATE WASHDC 0558
INFO RUEHRC/DEPT OF AGRICULTURE USD FAS WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHC/DEPT OF LABOR WASHINGTON DC
RHMFIUU/HQ USSOUTHCOM MIAMI FL
RUCNMER/MERCOSUR COLLECTIVE

UNCLAS BUENOS AIRES 000368 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
TREASURY FOR LTRAN AND MMALLOY 
E FOR THOMAS PIERCE 
PASS USTR FOR DUCKWORTH 
USDOC FOR 4322/ITA/MAC/OLAC/PEACHER 
US SOUTHCOM FOR POLAD 
 
E.O. 12958: N/A 
TAGS: EAGR ECON ENRG EPET AR
SUBJECT: ARGENTINE AGRICULTURAL SECTOR ON STRIKE 
 
Reftel: (A) Buenos Aires 00328 
 
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Summary 
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¶1. (SBU) Argentina's agricultural sector has organized protests -- 
during which no commodities have been sold -- in opposition to 
changes announced by Economy Minister Martin Lousteau to Argentina's 
agricultural export tax scheme (Ref A).  Roadblocks have disrupted 
travel across a large part of the country.  Protests are expected to 
continue into next week and food shortages are expected to begin 
next Tuesday.  Argentine public opinion is divided, with almost half 
supporting the agricultural sector.  Government officials publicly 
indicate that they will not revise the tax policy decision.  END 
SUMMARY. 
 
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Strike is continuing through the Holiday Weekend 
--------------------------------------------- --- 
 
¶2. (U) To protest changes to Argentina's agricultural export tax 
regime that were announced last week by Economy Minister Lousteau 
(Ref A), Argentina's four major agricultural producer entities 
(Sociedad Rural, CRA, Coninagro and FAA) have instigated and 
supported a widespread lockout by the sector (since March 13) during 
which no commodities are being sold and roadblocks have disrupted 
travel across a large part of the country.  Although the strike was 
initially planned for two days, the entire agricultural sector has 
extended the protests for more than seven days, and they will likely 
continue the action beyond the "Semana Santa" holiday weekend.  Post 
contacts report that roadblocks and protests are expected to 
continue throughout the long weekend, despite assurances from the 
agricultural sector that holiday travelers will not be affected. 
The four groups have agreed to meet again on Monday, March 24, to 
determine if they will continue to support the strike. 
 
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Roadblocks Abound 
----------------- 
 
¶3. (U) The four agricultural entities have organized protests in 
more than 70 points across the main agricultural region of the 
country.  Roadblocks have occurred in the provinces of Buenos Aires, 
Santa Fe, Cordoba, Entre Rios, La Pampa, as well as the northern 
provinces of Salta, Formosa and Santiago del Estero.  Post contacts 
have reported that protestors in Cordoba have, in some situations, 
seized trucks and railcars of grain headed to market, and dumped the 
contents onto the highway and rails.  The Embassy sent a warden 
message warning of the roadblocks March 20 to U.S. citizens 
throughout Argentina. 
 
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Food Shortages Expected 
----------------------- 
 
¶4. (U) Producers have shown solidarity in boycotting sales of 
agricultural food products.  On Tuesday, March 19, reports indicate 
that only 95 cows entered the Liniers slaughter market, Argentina's 
largest.  On a typical day, that volume would reach 10,000.  The 
following day, no cattle were sold at all.  Gustavo Freixas, 
Director of the Argentine Cattle Brokers' Association, predicts that 
meat shortages will begin by next Tuesday.  In addition, the 
president of the Argentine Agrarian Federation (FAA), Eduardo Buzzi, 
has been quoted that certain breads could also soon become in short 
supply. 
 
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Reactions 
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¶5. (U) Local media surveys of the urban population show that about 
fifty percent of the public supports the agricultural producers, 
while the other half agree with the government's decision to add 
taxes on the sector.  Government officials have publicly stated that 
they will not revise the tax system.  Cabinet Chief Alberto 
Fernandez stated publicly that agricultural producers "extort the 
people and make them suffer because they [producers] feel they have 
the right to keep enormous profits that all Argentines facilitate 
for them."  Fernandez was also quoted as saying he considers 
producers' decisions to block sales of meat as "extortion," because 
meat "is not affected by the export taxes." 
 
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Comment 
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¶6. (SBU) This is the first massive strike of the entire agricultural 
sector against the Cristina Fernandez de Kirchner administration, 
and it has now surpassed in size all previous strikes by the sector 
within the last 30 years.  Although Government officials indicate 
that they will not revise their policy decision, which has the 
effect of raising taxes on most agricultural commodities, there are 
rumors within the sector that policymakers are entertaining the idea 
of collecting export taxes based on producers' volume of grain sold. 
 That would be a transparent attempt to peel off smaller producers 
from the strike.  However, it is uncertain how the government would 
structure such an arrangement.  Media commentators note that the 
protests encompass the whole range of producers, from small to 
large, undercutting the government's efforts to argue that the 
policy decision was aimed only at wealthier, large producers. 
Although the organizing agricultural entities have stated that 
holiday travel will not be affected, Post contacts involved in the 
protest indicate that the roadblocks will continue.  The sector's 
strike seems to have found some sympathy among the public; that 
could evaporate quickly as Argentines find their holiday plans 
disrupted. 
 
WAYNE