An 11-day-old Argentine port workers' strike has halted key grains exports and could soon start affecting other commodities shipments around the world, the Rosario grains exchange said on Monday.
Specialized crews that moor ships in Argentina have walked off the job to demand more staff be assigned to work busy docking shifts. Scores of vessels have had to drop anchor at the mouth of the country's river ways while the dispute drags on.
This has crippled farm exports that are an important source of government revenue. But that is only part of the damage being done by the walkout, said Alfredo Sese, transportation expert at the Rosario grains exchange.
"The work stoppage is still on, and the damage is significant in terms of operating costs and the delay in exports," he told Reuters.
"But the losses are not only growing lineally," he said. "They are growing exponentially, because each ship waiting to be docked has to delay not only its current shipment but the ones it was planning to make next, in some other part of the world."
The labor disruption held up about 85 grains ships in Rosario port, Argentina's main grains hub, the CIARA-CEC grains exporting group said on Friday.
Argentina is the world's biggest exporter of soyoil, used for cooking and in the booming international biofuels sector, and soymeal, used as animal feed. It is also the No. 2 global supplier of corn and No. 3 in soybeans.
Talks might be held on Tuesday aimed at ending the strike, which came after crop prospects had already been dented by a drought that parched fields in December and early January.
Argentina now expects a 2011/12 soy crop of up to 45 million tonnes and a corn harvest of up to 22 million tonnes, both lighter than the previous season's take. Harvesting of 2011/12 soy and corn is set to start in earnest later this month.
The dockers' strike meanwhile threatens to increase the cost of doing business in Argentine ports as exporters factor in the threat of shipping delays and pass those costs onto growers in the form of lower grains prices paid at the farm gate.
"The repercussions will be felt throughout the value chain," said Buenos Aires-based economist Manuel Alvarado Ledesma, "This hits producers especially hard, considering that they have no one to pass the costs onto."
Farm revenue is key to Argentina's fiscal health. So port strikes in the country are followed by international grains traders as well as economists and sovereign bondholders.
Cargill, Bunge, Molinos Rio de la Plata , Noble and Louis Dreyfus are among the grains exporters that operate in the country.