To compensate small & midsize farmers for a portion of the export tax paid on soybean, a payment scheme has been authorized in Argentina.

This measure is taken to incentivize selling for the next several months among smaller-scale farmers.

The payments are based upon sales recorded between February 1 to December 31, 2020.

The policy would provide financial benefits to small & midsize farmers more to those in marginal soy production zones; such farms accounts for 23% of total soybean production.

The government in Argentina published a Joint Resolution detailing a payment scheme to compensate small & midsize farmers for a portion of the export taxes paid on soybean.

The eligibility for payments is based on farm size.

Farmers will not receive reimbursement on actual taxes paid but instead based upon a production-based formula. Individual farmers or farm corporations are also subject to certain income restrictions based on past tax records. Payments are divided among farm size: 0-100 HA, 101-200 HA, 201- 300 HA, 301-400 HA, and reimbursement rates are higher for both smaller farms and farms located outside of the core production region of the Provinces of Buenos Aires, Santa Fe, Cordoba, and Entre Rios.

The compensation is calculated on the following basis (Tons of soybeans sold, up to 2.9 or 2.5 tons/HA) X (Farm Size Reimbursement Rate by Province).

For sales recorded between February 1 and September 30, 2020, farmers will receive reimbursement payments in two transactions, 50% in November 2020 and 50% in December 2020.

For sales recorded between October 1 and December 31, 2020, farmers will receive reimbursement payments in three transactions, 40% in January 2021, 40% in February 2021, and 20% in March 2021.

This resolution expires on December 31 this year and will be based on sales recorded in 2020 and is unlikely to affect future planting decisions.

Compensation for Farmers in Argentina