Alexandre Malisani
Drought, policies hit wheat crop
In Buenos Aires, wheat export taxes where increased because of the dry conditions in 2006/2007. One year before, a similar problem appeared, when very few rain hurt the wheat crop and slashed the seeded area by 18% from the previous season. That year, production sank to 12.5 million tons from a record 16 million tons recolected one season earlier. To avoid a possible government ban in exports, wheat exporters accepted in lowering their own sales abroad. After encouraging wheat exports in 2006/2007, the government finally rised taxes in wheat exports, which discouraged wheat cultivation.