BUENOS AIRES (Reuters) - Argentina’s government will cut the cost of docking services in the ports of Rosario, the country’s main agricultural hub, by 30 percent when it implements a maximum rate for entry and exit guide services in December, an official told Reuters on Wednesday.
The official decision is part of President Mauricio Macri’s crusade to lower the costs of producing and exporting grains to boost economic growth in the world’s No. 3 soy and corn exporter.
“The reduction will be 30 percent, that is, the future value will be 70 percent of the current one”, said Jorge Metz, national undersecretary of ports and waterways in the country’s Transportation Ministry. He said the ruling on the maximum rate for navigation services would be made in December.
The cost of docking services in Rosario, the point of departure for 80 percent of Argentina’s agricultural exports, is about $108,000 per vessel, according to Metz.
That figure represents about 30 percent of the port costs attached to the roughly 2,500 cargo ships that travel to Rosario annually, Metz said, adding that the ministry has the authority to regulate the rate, thanks to a decree issued earlier this month.
Guillermo Wade, manager of the Chamber of Port and Maritime Activities, said a reduction “is important because it is one of the biggest costs you have, the biggest cost today is the toll, and the second is the docking cost.”
The measure will benefit agro-export giants like Cargill Inc [CARG.UL] and Bunge Ltd, which have their own terminals in the town of Puerto General San Martin, north of Rosario.
Metz said due to the diversification of suppliers of the loading and unloading services for grains, the stowage rate had registered a drop of around 30 percent. With other government measures and negotiations, stowage costs have been reduced by a total of 60 percent, he said.
“THE SUPERMARKET OF THE WORLD”
During Macri’s 2015 presidential campaign, he argued that the agricultural and agro-export chain should be a key focus in order to make Argentina the “supermarket of the world.”
Macri pledged to increase output to 150 million tonnes from 120 million before he took office and lower costs for exporters by 30 percent.
Within weeks of taking office, he eliminated taxes on corn and wheat exports and promised to phase out soy export taxes.
As part of the effort to increase productivity in the agro-export sector, the government in September pushed a union that represents dock workers to accept competition from rival companies after decades of monopoly.
Farmers say costs could be further lowered with better infrastructure, including trains and canals. They also want to see soy export taxes lowered faster and complained when top grains producing province Buenos Aires, governed by a Macri ally, approved a 50 percent increase in the tax on farm land on Tuesday.
But exports have risen significantly, nonetheless.
According to data from the Ministry of Agroindustry, wheat exports between January and September climbed to 9.4 million tons, 150 percent more than in the same period in 2015, when the interventionist policies of former President Cristina Fernandez still prevailed.
In the case of corn, growth in the first nine months of the year compared with the same period two years ago was 24 percent, with 18 million tons of grains shipped.
Writing by Cassandra Garrison; Editing by Caroline Stauffer, Jonathan Oatis and Lisa Shumaker