Argentine farm groups to lift protest on Monday

By Cesar Illiano

BUENOS AIRES (Reuters) - Argentine farm groups decided to end their latest protest against soy export taxes on Monday as planned, after a meeting where they discussed possibly extending the anti-government action.

The farm groups made the announcement on Friday as frustrated truckers began blocking rural highways to press for a solution to the stand-off between the government and the agricultural sector, stoking fears of food shortages.

"This is a new contribution from Argentine farmers in search of solutions and social peace," the country's four main farm groups said in a statement.

Farmers in Argentina -- a major world supplier of soybeans, beef, corn and wheat -- have been holding back grains from market since May 28, in their third protest in as many months against government farm policy.

The prolonged conflict between the agricultural sector and the government has hit Argentine bond prices, sparked demand for safe-haven dollars and hurt the trucking industry as well as paralyzing local grains markets.

President Cristina Fernandez's centre-left government introduced in March a sliding-scale system for grains export taxes that hiked levies on the top crop, soybeans.

Fernandez slammed the farmers in a Thursday night speech, saying that only the wealthy could afford to stop working for 90 days. Having taken office in December, her popularity rating has slumped amid drawn-out protests against the strike.

The country's top Roman Catholic bishops asked the government this week to call for "transparent and constructive" dialogue and urged protesting farmers to change their methods.

The farm groups said they would join on Monday a negotiating table set up by the national ombudsman.

But Agriculture Secretary Javier De Urquiza told reporters government representatives would not go because they do not accept any mediators in the conflict.

The roadblocks forced several truckers transporting milk to dump their spoiled goods, rattling a country where nearly one in four people is poor. Some food industry officials warned on Friday that beef and dairy shortages could be felt in the coming hours if protests continued.

(Additional reporting by Nicolas Misculin; Writing by Fiona Ortiz; Editing by Christian Wiessner and Braden Reddall)