UPDATE 1-Argentine farmers to end strike, warn of more protests

* Soy, corn growers froze sales to protest government
policies
* No export disruptions seen due to dockside reserves
* Drought-hit farmers need cash, will end strike at midnight

By Hugh Bronstein
BUENOS AIRES, June 12 (Reuters) - Argentine farmers said
they would allow a one-week freeze on grains sales to end as
planned on Tuesday, but threatened to stage more anti-government
protests against taxes and export curbs.
The sales strike was called by growers angry about
state-centric agricultural policies and a recent tax increase in
No. 1 soy- and corn-producing province Buenos Aires.
Argentina is a top exporter of both crops at a time of
growing world demand. Exports from the country were not affected
by the sales freeze, as dockside silos had been topped off with
freshly harvested reserves just before the protest began.
Farmers punished by extreme weather this season were eager
to end the sales strike in order to get much-needed cash.
Leaving the door open to more anti-government
demonstrations, the country's main farm groups said the sales
strike would end at midnight Tuesday (0300 GMT Wednesday).
"We're ending this protest, but that doesn't mean the
struggle is over," Eduardo Buzzi, head of the Argentine Agrarian
Federation (FAA), said at a news conference.Argentine farmers are harvesting the last of their 2011/12
corn and soybeans after a spate of production estimate cuts that
left many growers worried about cash flow.
"We cannot hold our products back from market indefinitely,"
said Jorge Garat, who has a 1,300-hectare grains farm in the
western Buenos Aires town of Trenque Lauquen.
Garat saw crop yields fall this season due to a drought that
hit Argentina's grains belt in the December-January dog days of
the Southern Hemisphere summer. Yields were further cut by
record May rains that swamped some of the same Buenos Aires
fields that had been parched by the sun at the turn of the year.
The government expects soy production of 41.5 million tonnes
this season after the six-week dry spell dashed initial hopes of
a bumper crop. The Agriculture Ministry expects corn output of
20.1 million tonnes, far below the record 30 million tonnes
foreseen by officials at the start of planting.

LONG CRITICIZED
Global food demand is expected by the United Nations to
double by 2050 as world population hits 9 billion. With the vast
and highly fertile Pampas grains belt, Argentina will be a key
food supplier over the decades ahead.
But the country's growers have long criticized President
Cristina Fernandez for scaring away investment with policies
that increase the state's role in the economy.
They say profits are hurt by wheat and corn export curbs
imposed by her government to ensure ample domestic food
supplies. Even before the Buenos Aires land tax increase was
announced last month, farmers complained about the 35 percent
tax that the government puts on soybean exports.
Argentina is the world's top exporter of soyoil, used in the
booming international biofuels sector. It is also the No. 1
supplier of soymeal, used as cattle feed, particularly in China,
where the emerging middle class is clamoring for beef steaks.
Trading companies with operations in Argentina include
Cargill Inc, Bunge Ltd Molinos Rio de la Plata
, and Noble Group Ltd.
Flow of grains trucks into Argentina's main port of Rosario
slowed to a trickle this week due to the sales freeze, causing
some traders to start getting nervous about reserve stocks.
"We have not stopped (exporting), but we would not be able
to go on much longer if the sellers' strike were to continue,"
one Rosario-based export company executive said.
Only 1,000 trucks entered the port in the 24 hours through
mid-morning Tuesday, down from 4,600 on the same day last year,
the Rosario grains exchange said.
About 80 percent of Argentina's farm exports are shipped
from terminals that line the Parana River at Rosario, offering
quick access to the shipping lanes of the South Atlantic.