Following a meeting of the ‘Mesa de Enlace‘, the agricultural leaders’ roundtable, Argentine farmer groups discussed an indefinite strike on the sale of soy this harvest season.

At the Pehuajó conference, farmers decided they would refuse to sell their crops beginning in April as protest against the national government. The group says the strike will continue until the government recognises their demands for a meeting to discuss a number of issues, including the elimination of registration forms for grain operations.

Alfredo de Angeli, a leader for the cause, said, “I wanted to avoid the halt to production, but the president needs to help us solve our problems.”

They claim the government has refused to meet with them for the last 13 months. In light of the threat of strike, the government is discussing reviving the defunct National Grain Board to control prices.

Luis Miguel Etchevehere, president of the Rural Society of Argentina, a group that represents landowners, said restarting that program would be “another disaster.”

Although Etchevehere declared the possibility of this strike, he said the group will go to Chaco, Santa Fe, Entre Rios, and Córdoba to gauge farmers’ opinions before acting.

One of the many AFIP offices (Photo by blmurch, on Flickr)

The Federal Taxes Administration (AFIP) has begun an inspection of soybean harvesters in order to ensure all produce is declared and to avoid producers retaining stock.

Expected to last 15 days, the AFIP have launched an operation into one of Argentina’s main exports, which has already been put into effect in certain areas of the Province of Buenos Aires, such as in the town of San Antonio de Areco.

AFIP plan to create a comprehensive inventory after reviewing and monitoring the stores of soy available around the country. The accumulation of such information is said to involve a letter sent to producers asking for the amount of soy stored. If the figures provided arouse suspicion, an inspector will be sent to verify the veracity of the information.

Producers, however, predict a poor harvest with low rainfall expected, which will likely result in an increase in the price of soybeans. It has been reported by El Cronista that the soy remaining from the last harvest “is between one and two million tonnes”, which would “represent profits of some US$645.4 million”, of which the Treasury would expect to get 35%.

The Soybean crop last season was held at 40 million tonnes, 22% below the 2010/2011 crop, where approximately 52 million tonnes of soybeans were harvested.

On 10^th October, Miguel Galván was murdered, stabbed to death in the doorway of his own home. Almost one year earlier, Cristian Ferreyra had been shot and killed in his house. Both men were peasant farmers from the northern province of Santiago del Estero and members of the National Peasant Movement of Santiago del Estero – Farmers’ Way (Mocase-VC) an organisation which fights for the land rights of peasants and indigenous people.

Protest at Congreso to call for justice against the assasination of Miguel Galvan (Photo courtesy of Mocase-VC)

The reason for the men’s murders was that they refused to give up their land to multi-national soybean plantation companies. Whilst Galván’s attackers are yet to be identified, in Ferreyra’s case it is widely claimed that a large landowner from the area hired hitmen to remove him from his path.

In the six months after Ferreyra’s tragic death, incidents of conflict between large agribusiness and peasants decreased, but since then, the expansion of soy production has continued and so have the forced evictions of peasants and indigenous people from lands they have occupied for centuries.

Expansion of Soy and Agribusiness in Argentina 

In 1996, Carlos Menem’s government approved a law that granted farmers permission to cultivate transgenic soybeans in Argentina. The decision brought about a drastic and rapid change within the country’s agricultural sector. Argentina allowed for the cultivation of genetically modified soybeans without carrying out their own tests, instead using only those provided by the multinational agribusiness Monsanto.

Argentine farmland with monocrops. (Photo: Franco Vissani)

The economy was struggling and Menem sought large corporate contracts that could be seen as evidence of potential future recovery. Within a year, 11 million tonnes of soy were harvested from an area spanning 6 million hectares. Fast forward 15 years to today, and the entire country bares an alarming resemblance to a giant field of bioengineered soybeans. Argentina is the third largest producer of soy in the world and is responsible for one third of worldwide soybean sales. A staggering 97% of the soy harvested is exported worldwide.

Today soybean cultivation occupies more than half of Argentina’s productive land.  However, long before the arrival of the multinational soybean plantation companies, the land was largely farmed by local and indigenous peasants. In 1988, there were 422,000 small farms based in Argentina’s countryside. By 2002, this number had fallen by almost 25%.

Guillermo Neimann, a sociologist at the Latin American Faculty of Social Sciences (FLACSO) who specialises in the area of rural employment, explains that “Argentina is not a country that has historically experienced large land conflict. It is only in the last few decades that it has appeared, with the arrival of large agribusiness”.

What had previously been a diverse and self-sufficient agricultural system was rapidly replaced with a model of virtual monoculture. As Brewster Kneen, author of Farmageddon, puts it, Argentines were “quite literally forced” to produce soy “in place of milk, meat, vegetables, and lentils which were once produced in abundance on the small farms which have now been overrun by large landowners growing soy.” Nowadays, lentils are imported from Canada whilst exports of Argentina’s famous beef decline annually. “That’s like Mercedes-Benz not exporting cars!” exclaims agriculturalist and member of the Grupo Reflexion Rural, Adolfo Boy.

Traditional small goat farming in Santiago del Estero is becoming more difficult to do. (Photo: Andres Lofiego)

Provinces in the northwest of Argentina, such as Santiago del Estero, were hit particularly hard. Soybean cultivation in the area increased by 48% between 1988 and 2002.

Violence and Evictions 

Henk Hobbelink, agronomist and co-ordinator of small farmers’ rights campaign group GRAIN, gave a speech last year in which he said, “today we are witnessing nothing less than the full frontal assault on the world’s peasantry.” Nowhere does this ring more true than in Argentina.

As big agribusinesses expand their soy plantations throughout the countryside, they encounter resistance from the local farmers who have cultivated the land for centuries. Thus, they employ certain methods to remove those who obstruct their path, the most extreme cases being those of Ferreyra and Galván. The land rights of indigenous communities that have been there for centuries are ignored.

According to Adolfo Boy, the eviction process begins when “groups of lawyers, or property developers, that know the land registry, forge papers, and turn up and tell the peasants that they are the owners of this land”.  He points out that beyond this, “there are paramilitary forces, thugs and police, all practically at the service of the expanding soy companies” who help finish the job.

The original land inhabitants and owners are left with two options: move to the slums surrounding the cities or submit themselves to the inhumane working conditions of life as an employee of one of the big agricultural companies. As Kneen puts it “one does not want to wonder how many of the ubiquitous garbage pickers on the streets of Buenos Aires were once small farmers”.

Laws: Present and Future

In a recent interview with Radio Mundo Real, Mocase-VC leader Cariló Olaiz, declared that existing laws that protect peasant farmers are not being enforced. He maintains that in the lead up to Galván’s death, the organisation informed local authorities in Santiago del Estero that the farmer was receiving death threats and that his life was in danger. “As in the case of Cristian (Ferreyra), we filed all the accusations and we even had a meeting with a judge in July. The government of Santiago del Estero was aware of this and did nothing to stop the armed gangs,” said Olaiz.

Mocase-VC blames the governor of the province, Gerardo Zamora, directly for Galván’s murder, given his lack of action in the lead up to it. They point out that on 3^rd October, the provincial government of Santiago del Estero issued a report that highlighted the dangers faced by small farm owners trying to protect their land on a daily basis. Despite their awareness of the dangers, no measures were taken to protect peasants and a week later Galván was killed.

A protest in Santiago del Estero organized by Mocase-VC and MNCI Argentina (Photo courtesy of Mocase-VC and MNCI Argentina)

Now the National Peasant Movement (MNCI), along with other peasant and human rights organisations are urging the government and Congress to pass a new law that will bring an end to the evictions. A UN human rights council declared itself in favour of the bill, which was first called for following the death of Ferreyra, but has been consistently delayed by authorities ever since.

Edgardo Depetri is one deputy who has pledged to do all he can to pass the law before the end of the year, but campaigners remain doubtful given the government’s history of slow progress when it comes to peasants’ rights. Neimann makes the point that “a law like the one protecting peasants from evictions is very important but it alone is not going to be sufficient. We need to improve the justice system, above all at a local level. Provincial governments need to understand that regulating the expansion of agribusinesses is vital”.

The Power of Monsanto

Monsanto is one of the world’s largest food production companies. It was Monsanto’s genetically modified RoundupReady soy (RR) that was approved by Menem in 1996. The RR technology allowed for soy to grow in arid areas, and in so doing greatly reduced the need for manual labour. Monsanto dominates the current soybean market in Argentina and is the driving force behind the corporate wave that is destroying peasant farming. Kneen offers a scathing verdict: “the clear and present danger is the corporate control of food, which is what Monsanto is clearly after. On this account, and because I despise its ruthless tactics, I do not hesitate to describe it as an evil company”.

The power that is held by the world’s largest food producers cannot be underestimated. Boy describes Monsanto as “a multinational that is capable of all types of corruption” whilst Neimann says that “it acts without any restrictions”.

Despite these traits, the Argentine government relentlessly pursue bigger and longer lasting deals with Monsanto and other big agribusiness companies. As recently as June of this year, president Cristina Fernández de Kirchner announced a new agreement with Monsanto. As part of her Agribusiness Strategic Plan (PEA), the president hopes to increase grain production by 60% to 160 million tonnes by 2020, 20% of which will be soy. Following the accord, president Fernández announced that she was “very happy because Argentina is now at the forefront of biotechnology”.

Whilst the revolutionary scientific developments made by companies such as Monsanto are undeniable, their products are not without faults. The exclusive use of RR has caused biotypes to disappear, weakened the soil, and made it less productive for future farming.

Rural populations have also been affected by the spraying of the herbicide due to its glyphosate content. Local doctors complain of higher cases of miscarriage, birth abnormalities, and respiratory dysfunction. As Kneen sums up “the danger may well turn out be genetic”. Not to mention the deforestation that has to occur in order to make way for the vast soybean plantations. The region of Santiago del Estero has shown one of the highest rates of deforestation in the world with an average of 0.81% of the forest torn away each year, compared with a global rate of 0.23%.

The Crop That Just Keeps on Giving

Though unpopular among human rights organisations, against a backdrop of record-high world prices for soy and other crops, the immediate economic gains of an industrial, concentrated agricultural model have so far dissuaded politicians from taking definitive action against it.

Silos of soy in the fields of Junin. (Photo: Nicolás Lope de Barrios)

Given the increase in global commodity prices, Neimann explains that soy production gave the government “the opportunity to enter the market in a way it never had before. Governments all over the world are trying to make the most of any opportunities they have in the commodities market”.

According to Boy, this is the reason why politicians sometimes employ a double standard. Officials do acknowledge that working conditions need to improve and that deforestation needs to be monitored, but yet they continue to ally themselves with the big agribusinesses.

Given the way in which international food companies are opting to persecute rather than coexist with small farmers, it would appear that Argentina cannot pursue biotechnology and simultaneously maintain a peasant farming model. Boy paints a bleak picture of the situation: “For the time being, nobody is going to break the soy model. It doesn’t matter what political party they are in, whoever comes in, is going to continue exactly as we are, because they all think the same. Not a single province or municipality is going to plant anything else. Nobody is thinking about local production or local development”.

In an interview with journalist Dario Aranda, Nobel Peace Prize winner Adolfo Pérez Esquivel interpreted the current situation as evidence of the fact  that the government “gives priority to economic interests over people’s lives”.

“It Will Happen Again” 

The expansion of soy production in Argentina has equated to the invasion of peasant and indigenous territory by multinational agriculture companies. Government policy is deliberately replacing peasant agriculture with an agro-industrial model driven by the needs of multinational corporations. At both national and provincial levels, they are enabling this to happen; they are either postponing or not enforcing peasant’s rights laws, and meanwhile people continue to be killed. Widespread deforestation is taking place and cultural and biological diversity is being destroyed.

Industry vs Nature. (image courtesy of Grupo de Reflexión Rural)

As Kneen puts it “agribusiness today exists to produce crops as a means to make money. It fosters the exploitation of people, land, and resources to produce crops to export and trade elsewhere”.

The international peasant organisation, Via Campesina, says that the expansion of soy is pushing Argentina’s small farmowners and their methods of production to the brink of “irredeemable extinction”.

“The current agricultural model is a way of farming without the farmer” says Boy. “Nowadays, politicians are not motivated by the same things we are; what has happened to us, the violence, the urbanisation, the displacement. Argentina is not a happy place. All this is because of the agricultural model”.

Following the recent murder of Miguel Galván, Mocase-VC released a statement entitled “It could have been avoided, it will happen again”. In light of the government’s recent activity regarding the new deal with Monsanto, and inactivity concerning peasant’s rights, it is hard to disagree.

Latin America’s vast forests are rapidly disappearing. They have come to represent yet another quickly diminishing artery of the continent’s many ‘open veins’.  Their fertile land is being converted at an increasingly alarming rate for the purposes of large-scale agribusiness, namely, soy.

Images of deforestation in the wild Chaco. (Photo: Greenpeace)

Louis Reymondin is the man behind a new satellite imagery and ground processing system, Terra-i, mapping deforestation across South America.

Reymondin, a Swiss native, is a third-year PhD candidate in the Department of Geography at King’s College of London and has been working as a visiting researcher at the International Centre for Tropical Agriculture (CIAT), whose headquarters are based near Cali in southwest Colombia, for the last five years. During this time he developed Terra-I from scratch.

The complex system detects land-cover changes resulting from human activities in near real-time, producing updates every 16 days. It currently runs for the whole of South America.

“So far the system has shown that deforestation has increased in Caquetá, Colombia by 340% since 2004, and the Gran Chaco region of Paraguay, the second most forested area in South America, has lost over a million hectares of forest.”

Deforestation in Argentina

According to Reymondin, “In Argentina, Terra-i has performed habitat status monitoring every 16 days from the 1st January 2004. During the past eight years, it has detected a cumulative habitat loss of 1,955,419 hectares, equivalent to an annual national loss rate of 244,525 ha/year.” To give an idea of scale, that is roughly an area the size of Luxembourg lost each year.

Deforestation is centred in the north of the country where its largest forest, and the continent’s second largest, following only the massive Amazon, lies.

“The provinces of Santiago del Estero and Salta were the most heavily impacted, having 590,094 hectares and 516,069 hectares converted respectively between 2004 and 2011.”

Map of habitat loss in Argentina, Terra-i detection.

The Gran Chaco spreads over three countries: Argentina, Bolivia, and Paraguay. As defined by data provided by the Organization of American States (OAS), the “Gran Chaco Americano” biome covers approximately 1,000,000 km² of South America and encompasses the central-north region of Argentina (53% of the total area of the Gran Chaco and 22% of the country’s surface area).

According to Reymondin, the South American Gran Chaco is a mosaic of habitats. It is a hotspot of biodiversity on the continent and one that is becoming increasingly threatened.

The data coming from Terra-i is especially pertinent as it attempts to isolate the deforestation resulting from human activity.

“The Terra-i outputs are of course not noise [error] free and we cannot guarantee that every single pixel that has been detected is the result of human activity, nor is Terra-i detecting all the events of deforestation that occurred since 2004.”

That said, Reymondin has included many special equations to ensure it is the best data available: “… we have implemented a range of methodologies to reduce the effect of noise, such as cloud cover, and to filter land cover changes that are not human-caused, or at least not directly, such as floods and drought. We can therefore say that the majority of the detections that we observe can be attributed to human activity.”

Why is the Chaco Disappearing? 

Perhaps the most obvious driver of change is the blanket of soy that has been rapidly spreading over the continent since the 1990’s.

Changes in global markets have expedited this process in the new millennium, especially in Argentina. A country with a huge farming component, the rolling pampas of grazing cattle typically associated with the Argentine countryside are being replaced by industrial farms growing soy, now a much more lucrative crop for any farmer.

The romantic vision of ranch life remains important in Argentine culture, but the economic equations involved in the agriculture business have changed in recent years.  The expansion of soy farming is driven by US ethanol production and a global interest in biofuels; prices for soy continue to break records.

Soybean farming has been rapidly spreading over the continent for the last ten years. (Photo: Greenpeace)

Some agricultural analysts say that Argentine soybean farming is now several times more profitable than cattle ranching.

It is these profitable equations which are threatening the Chaco. Large-scale agribusinesses are encroaching on protected Chaco regions both themselves, and by pushing cattle ranchers into the area after evicting them from lands they traditionally used.

Now the third largest soy producer in the world, Argentina’s aggressive land conversions will soon change this status. Widespread drought in the US, formerly the top soy producer, combined with a larger than usual yield predicted for the 2012-2013 harvest, will put the Southern Cone soy producers in the top spot for production.

Paraguay, Argentina, and Brazil combined are producing well over half of the soy on the international market. All countries in the Southern cone are rapidly converting all arable land to soy at breakneck speed.

Lessons of Paraguay 

Perhaps nowhere is the power of soy, and the threat to the Chaco in the face of this, more apparent than in the case of Paraguay.

Recently, Paraguay made headlines worldwide by the all-too-quick impeachment of left-leaning president Fernando Lugo, prompting international sanctions and public condemnation.

Paraguay is currently the fourth-largest exporter of soy. Loose regulations and relative poverty make it an easy target for multi-national soy giants to take hold there. Terra-i created a video -which can be viewed here- illustrating the massive changes in land taking place in the neighbouring country.

Around 77% of Paraguay’s arable land is owned by just 2% of the population. In the past ten years, deals have been struck for 203 million hectares of land — nearly six times the size of Germany — at a pace and scale that outstripped the ability of governance structures to respond, a situation which Lugo sought to reverse with a reform that never quite came to fruition.

Jeremy Hobbs, executive director of Oxfam International, writes in a recent opinion piece for the New York Times, “The Paraguay soy boom — made in China and Europe and grown upon the lands of the political elite — is controlled by the boardrooms of Big Business. As much as 70% of Paraguay’s soy is exported each year and of that the multinational grain giants Cargill, ADM, and Bunge account for about 70% [of all soy exported].”

Los Angeles based KPFK’s Sojourner Truth radio show recently featured a segment on the impeachment of Fernando Lugo. The show hosted Miguel Lovera, the former national secretary for plant safety under Lugo, who spoke of the impeachment as being a coup orchestrated by a ‘Genetically Modified Soy Mafia.’

Lovera was outspoken on the show in claiming Lugo’s removal as being intrinsically related to his moves to protect Paraguay’s Gran Chaco from encroachment by multi-national soy companies and his desire to redistribute their land to smaller-scale farmers.

“The main comparative advantage of Paraguay as a soy growing territory has actually been the lack of regulations in the past. Since Lugo’s government took over that condition changed, and we actually started regulating … venturing into sensitive territory and they weren’t ready to adapt.”

Lovera hints that the original struggle in the northern region resulting in the deaths of peasants and police officers was not only orchestrated by the soy mafia, but actually committed by those in their employment.

At the very least, there is a dangerous concentration of power in terms of Paraguayan soy -an industry controlled by only a handful of very powerful multinationals which account for an undeniably influential lobby.

Lovera states that the Chaco, after small-scale peasants, is becoming the most visible victim, “[The Chaco] is also the area that is allocating all this displacement, the cattle ranching displacement in the areas that are good for soy growing, they are encroaching into this wilderness.”

To Bear Witness

The power of something like Terra-i in the face of the great changes taking place in South America is perhaps that it is an indisputable witness to what is occurring here. An omniscient eye-in-the-sky silently watching and detailing every change taking place, no matter how remote the location in which it is occurring.

“Habitat conversion is contributing to widespread loss of biodiversity and other critical ecosystem services, yet in many parts of the world the scale and pattern of habitat loss still goes unmonitored,” says Reymondin.

“Decision makers at multiple scales (local to national to regional) need information on land-cover change, as accurate and recent as possible, in order to prioritise interventions and act upon new land-cover change patterns in a timely manner. Terra-i aims to provide information about habitat loss at a temporal and spatial resolution that is relevant for decision makers.”

The data and real-time images coming from Terra-i provide interest groups, interventionists, and really anyone with an interest, solid data to point to. It is free, accessible, and irrefutable.

Infographic of the deforestation in Chaco showing the locations and damage done. (courtesy of Greenpeace)

Reymondin and his team aim to expand Terra-i. South America, while a significant achievement to monitor an entire continent, is but one of many hotspots in terms of biodiversity loss and deforestation due to human activity.

“We will keep updating the detection of deforestation in Latin America as data comes in from the MODIS satellite sensors. We plan to extend Terra-i to cover the whole tropics which will be a new challenge as this increases considerably the amount of data to process.”

Terra-I also plans to broaden its lens to encompass other resources, including the multifarious effects deforestation has on water resources.

Quite simply, Terra-I is the fly on the wall (or better, bird in the sky) bearing witness to the changes taking place. Increasing awareness and solid, publicly available information are key to social action.  Given this, perhaps tools like Terra-i could help to prevent future stories such as Lugo’s in South America.

How aware are Argentines of the deforestation problem? Click here to find out.

According to the Buenos Aires Grains Exchange, Argentina will plant 22% less wheat this season than it did in the previous crop year. The US Department of Agriculture forecasts Argentine wheat production at 12 million tonnes in 2012/13.  This is down from 14.5 million tonnes in the previous crop year- an overall reduction of 2.5 million tonnes.

Wheat growers in the country are expected to plant around 3.6 million hectares with wheat for the 2012/13 harvest- 100,000 hectares less than the Grains Exchange’s previous estimate.

Currently ranked the world’s sixth largest wheat exporter and the top exporter to Brazil, the tides are changing in Argentina’s agricultural climate due to state policies favouring other crops.

Many farmers are shifting toward growing barley and soy to avoid government-imposed wheat export limits.

Wheat futures jumped to the highest in almost four years as the worst drought since 1956 is eroding crop prospects in the US (usually the world’s top wheat producer) and dry weather hurts production in Australia and Russia.

Australia will face dry conditions for the next three months according to its Bureau of Meteorology. Russian farmers will collect 46.5 million tonnes of the grain in the season that began on 1st July, down 4.1% from 2011, researcher SovEcon said.

The United Nations expects global food demand to double by 2050 as the world population hits 9 billion. Argentina’s Pampas, an area greater than France, will be key to feeding an increasingly hungry world. However, these shifts paint a foreboding picture in meeting these demands.

Argentina is also the world’s third soybean exporter and second supplier of corn after the United States. Crops which many former wheat farmers are turning to in the face of restrictions and more lucrative prices.

Brazil is projected to replace the U.S this year as the world’s top soybean grower. Joined by Argentina and Paraguay, these South American countries are projected to provide over half the global soybean supply next year. The price of soy, which is used for animal feed and fuel, is also expected to remain high because of a lower supply due to droughts in South America last year, and in the U.S. this year.

Droughts are currently destroying soy crops throughout the U.S, while South American farmers are predicting strong crops and abundant rains because of El Niño. This weather phenomenon warms waters in the equatorial Pacific and usually leads to heavy rainfall in the Southern Cone.

Due to such predictions, farmers in Brazil, Paraguay, and Argentina are all expected to shift away from corn production and produce record amounts of soy. After a very successful winter corn crop, Brazilian farmers are prepared to dedicate this season to soy production. Argentine farmers are expected to plant about 20 million hectares, 1 million more than in the previous season, and Paraguayan production is predicted to reach a high mark of 8.1 million tons, according to Market Watch.

Meanwhile, in the U.S., experts have categorized the present drought as the worst since 1956 and expect very low corn and soybean production, as the global prices for both commodities increase due to tight supply, according to Reuters. Although some climatologists have suggested that El Niño won’t produce as much rain as expected in the soybean-producing South American countries, the current drought in the U.S. and the rising prices are making way for large-scale, record quantities of soy production in Brazil, Argentina, and Paraguay.

Fernando Lugo in the Government Palace watches images of his supporters on television on June 22. (Photo: Fernando Lugo Méndez)

In 2008, a bishop from the combative region of San Pedro, where important peasant struggles had been carried out, became president of Paraguay with the Patriotic Alliance for Change (APC). Aided by a strong division within the Partido Colorado -which had been in power for an uninterrupted period of 61 years, 35 of which were under Stroessner’s dictatorship- Fernando Lugo managed to win the elections and open up a new chapter in the country’s history.

But as soon as he made the decision to get involved in politics, encouraged by the support of citizens and social movements alike, especially the peasants, the ‘bishop of the poor’ encountered a dilemma: whether to run with his small party Tekojojá (‘Equality’, in indigenous guaraní language) and lose, or whether to try and win by making an alliance with the Partido Liberal Radical Auténtico (PLRA), a traditional political force clandestinely founded by Domingo Laíno in 1978 as opposition to Stroessner’s dictatorship, which re-grouped some sectors from the old Liberal Party that had governed Paraguay between 1904-1936.

The ghost of what had happened in Mexico in 2006, when Andrés Manuel López Obrador denounced being victim of election fraud, seemed familiar enough in Paraguay. So Lugo decided to side with the liberals -capable of providing votes, as well as making sure they were counted. He chose to seize the opportunity, maybe the only one he would have, of a Partido Colorado deeply divided between Blanca Ovelar, Nicanor Duarte Frutos’ candidate, and Luis Alberto Castiglioni, considered ‘the (US) embassy’s candidate’. The pro-Stroessner tripod made up of the government, armed forces, and the Partido Colorado had already started to crumble after the fall of the dictator.

Federico Franco greets Fernando Lugo (courtesy of Fernando Lugo Mendez)

And so, Lugo won. But at the cost of having a liberal vice-president -Federico Franco, who would later distance himself from the president in the midst of a division within the PLRA- and an almost non-existent parliamentary representation. Despite the fact that there had been important protests since Stroessner’s fall in 1989 (such as the one in 2006, against Duarte Frutos’ re-election attempts), Paraguay was far from being like Ecuador, where president Rafael Correa had enough social support to close down Congress and call for a Constitutional Assembly, or Bolivia, where Evo Morales has a massive indigenous-popular support base with important mobilisation capabilities.

Lugo also inherited a country impregnated by the colorados‘ political culture, where the fight for the state apparatus is ruthless, as made evident by the murder of former vice-president Luis María Argaña in 1999 -shortly before the resignation of president Raúl Cubas, who was at the verge of being impeached. An important character at the time was the right-wing, populist military officer Lino Oviedo, who was once protected by former Argentine president Carlos Menem, and who nowadays leads the Ethical Citizens National Union (also known as Ethical Colorados Union), which took part in the parliamentary coup.

Lugo’s presidency was based, at least at the beginning, in the politics of the ‘poncho juru‘ (in the centre, like the opening in a poncho). But even though he did not make consistent reforms, his government was -despite its contradictions- an interlocutor for the peasants and, for the first time, left-wing politicians were awarded some of the ministries. This caused enough concern within the landowners to have the spokesman for the ‘brasiguayos‘ -Brazilian-born land owners and their descendants- Aurio Fighetto, declare shortly after the coup that “the ‘carperos‘ (landless peasants who were occupying farms) were in the [government] Palace.” Such was the argument he was willing to use to ask Brazilian president Dilma Rousseff to recognise the new government. His colleague and president of the Association of Christian Businessmen, Luis Fretes, said with brutal honesty: “I believe Franco is going to be much firmer in terms of respecting private property.”

The issue of land is key to understanding anything that happens in Paraguay (80% of fertile land is owned by 2% of landowners). So is a variety of illegal activities -drug trafficking, smuggling, kidnappings- linked to the state, which has been permeated by a host of different criminal organisations.

Paraguayan farmers and signs of violence. (courtesy of Sub.coop)

There is no longer a massive exploitation of tannin (red quebracho) which enslaved thousands of peasants, and the centre of Paraguay’s economic activity is not timber or yerba mate production anymore. But although these products have been partially replaced, the logic of an enclave economy has remained, in an equally perverse way, with the new star crop: soy.

Today, Paraguay is the world’s fourth largest soy exporter. The area used up by soy plantations went from one to three million hectares between 1997 and 2012. And the borders between legality and criminality are diffused. Which is why, in the north of the country, the term ‘narco-stockbreeders’ has been coined.

In the midst of its extreme weakness, Lugo had to face an untimely guerrilla movement, the Paraguayan People’s Army (EPP), apparently organised by ex-militants from the Free Country group (some of its members have been accused of being involved in the kidnapping and murdering of president Rául Cubas Grau’s daughter, Cecilia, in 2004) and whose links and aims are not very clear. With only a handful of members, the EPP carried out actions such as destroying machinery in a soy farm accused of polluting a whole town -Concepción-, attacking a military barracks in San Pedro (the region where Lugo used to be a bishop), setting off a bomb in the national court and -the most important one- the kidnapping of landowners Luis Alberto Lindstron and Fidel Zavala in 2009. The latter was forced to distribute beef amongst the poor, ‘courtesy of the EPP’, and pay ransom before being released from the 3-month captivity. Leader Carmen Villalba, from prison, claimed responsibility for all these actions. Meanwhile, some members of the opposition accused Lugo of being an accomplice to the EPP -and even of being a member of it!

As all this was happening, it started to surface that the president had various illegitimate children (despite the fact that, as a bishop, he was supposed to be celibate) and he was victim of a cancer that threatened his life.

Fernando Lugo in a recent press conference after his impeachment. (Photography by Fernando Lugo Mendez)

Within that context, Lugo’s political survival seemed like a miracle: as well as Congress, he had the justice system, a stronghold of the old, corrupt politics, against him; the fraudulent bourgeoisie, which, despite continuing with business as usual, mistrusted the president’s left-wing entourage; the mass media, who shamelessly conspired in favour of the impeachment as they waved around the ‘Hugo Chávez ghost’; and his own vice-president. In this situation, only the divisions within the right and the popular mobilisation (or rather, the threat of it) managed to keep the former bishop in power.

The problems were not only a product of the conservative parties’ conspiracy, but also of the lack of internal cohesion within the government. In cabinet, there were “from obedient disciples of neoliberalism in finance, to apprentices of repressors in Interior, to great ignorants in agriculture, or conservative ex-activists in the social ministries. (Thus) what happened was bound to happen: uncertainty first, and disappointment later,” writes the recently deceased sociologist Tomás Palau on his book ‘Lugo’s Government: Legacy, Administration, and Challenges’. Despite all this, he highlights the creation of the Executive Coordination for Agrarian Reform and the writing of a report from the Truth and Justice Commission and the National Institute of Rural Development and Land about illegally-acquired land, some 8-million hectares of it, as well as the beginning of a reform aiming to guarantee free and universal healthcare.

The key was perhaps what former minister Hugo Richer highlighted some time ago: “Lugo’s government can’t be called left-wing, but thanks to him the left managed to grow and to gain an amount of political influence that it had never had throughout Paraguayan history.” This may not seem much in countries like Bolivia, Venezuela, or Ecuador, but it is enough to upset the elites in a country “watched over” by the huge statue of Chinese anti-communist leader Chiang Kai-Shek. And it is impossible to understand the recent conflicts without the ‘anti-communist’ key, very much a part of the Paraguayan political culture thanks to the strong predominance of the colorados, crucial in holding up Stroessner in power for 35 years.

Fernando Lugo Méndez meeting with political representatives from 'Frente Guasu' and the 'PLRA' (Photo courtesy of Fernando Lugo Méndez)

In the last few years, various groups started up the Frente Guasú (‘large’ in guaraní), which brought together centre-left and left-wing political parties, from social democrats to marxists, as a -sometimes critical- support base for the government.

But -as was already evident in 2009- the impeachment was around the corner, waiting for the right opportunity. In the last few days, it was revealed that the US embassy in Asunción had warned back in 2009 about a plan to remove Lugo as soon as he “made a mistake”, and that the conspiracy was led by Lino Oviedo and Duarte Frutos to put Franco in charge (cable from 28th March 2009, leaked by Wikileaks). Despite the affinity of the US with the new president, the parliamentary coup seems to be more related to internal causes -and the brutal power disputes- than to the traditional ‘CIA coup’.

The ‘mistake’ was the recent massacre of peasants and policemen due to a land-owning conflict in Curuguaty and the later appointment of former colorado prosecutor Rubén Candia Amarilla as Interior Minister. This appointment did not go down well with the left and deepened the liberal divide, whilst activating the internal struggles within the Partido Colorado, which rejected it.

Lugo accused Horacio Cartes, an important colorado leader, of being behind the coup. Cartes is a stockbreeder who entered politics not too long ago, but already has a high chance of becoming president of Paraguay in 2013. Apparently, Cartes thought his candidacy would be threatened by an alleged agreement between Lugo and his party’s president, Lilian Samaniego, who was once Cartes’ ally and is now an internal rival. According to Cartes’ supporters, Lugo would have plotted to enter into an alliance with Samaniego to lend her his support from government, ahead of next year’s presidential elections. This led them to support the former president’s removal.

As the correspondent for La Nación newspaper from Buenos Aires wrote, the three pillars holding Franco are the church (which immediately blessed the new president), Congress, and the business community, especially that related to the agricultural industry. He ‘forgot’, however, to mention the media. ABC Color, owned by the Zucolillo family, was an active part of the anti-Lugo conspiracy and there was not a single day since 2008 in which they did not warn about the ‘Chavista threat’. Now, the newspapers are publishing ‘nationalist’ columns which see the reactions of Brazil, Argentina, and Uruguay as a new Triple Alliance, like the one that massacred Paraguayans in the 19th century. And they claim that the “Paraguayan race” shall overcome.

With Franco, the liberals reached power for the first time in 76 years, and can now use the state resources until the 2013 elections to campaign and improve their chances. There is no doubt that, as political scientist Marcello Lachi points out, “politics here are not refined.” And controlling the state (and its resources, such as employment) is key to winning elections. This explains the urgency with which they acted, only a few months before an election in which Lugo could not be re-elected. Historical PLRA leader Domingo Laíno, however, has strongly condemned the coup and supports Lugo.

The colorados, meanwhile, are excited at the prospect of returning to power, like the PRI in Mexico, counting on the discredit the liberals will suffer now that they are governing on their own. They have so far managed to break up the APC, and the polls look promising for next year’s election. “If the left and the liberals go their separate ways in the election, the colorados will win with at least 35% of the vote,” says Lachi. There is no second round in Paraguay.

Lugo -whose first reaction was to leave office after being impeached and who did not call for social mobilisation- has regained the initiative and announced that he will go around the country garnering support, denounced the government as “fake”, and received important shows of support from around the region. However, it is unclear whether he is really looking to lead the resistance to an already settled government, or to begin his campaign to become a senator in 2013.

Translated by: Celina Andreassi.

The EU Supreme Court ruled that U.S.-based Monsanto Co. cannot use a patent on its genetically modified soybeans to block the importation of Argentine soy meal on 6^th July. The decision comes after Monsanto withdrew the lawsuit that produced the case on 23^rd June.

Monsanto impounded four containers of Argentine soy meal in Amsterdam in 2005 and 2006, arguing that the product contained traces of a copyrighted trait that makes the beans resistant to the company’s Roundup herbicide. The world’s largest seed corporation contended that its patents extended even after the soybeans had been processed into meal, and sued the importers for infringement. Monsanto wanted to charge between US$15 and $18 per tonne of the meal.

The EU Court, based in Luxembourg, disagreed.

“Monsanto cannot prohibit the marketing in the EU of soy meal containing, in a residual state, a DNA sequence” the ruling stated.

The decision will apply to 27 countries in the EU bloc and cannot be appealed. Though Monsanto had already withdrawn its lawsuit from the Dutch courts, the decision was considered largely symbolic, and will prevent the company from taking similar actions in the future.

After Monsanto introduced its genetically modified soy to Argentina in 1996, Argentina quickly became one of the world’s biggest soy producers. Last year alone, Argentines planted 43 million acres of the company’s Roundup Ready seeds, totaling to about 95% of the country’s soy production.

The rapidly increasing cultivation of soy for animal feed and Biodiesel has largely fueled deforestation, especially in areas like the Great Chaco and the Yungas.

“The grand scale of soy-based Biodiesel production presents a real threat to our last native forests,” Hernán Giardini, biodiversity coordinator of Greenpeace Argentina, told this newspaper in 2008.

“Trade knows neither friends nor kindred.” This famous proverb could perfectly summarize the current relationship between Argentina and China. Over the past weeks, the two countries have entered into a kind of fresh trade war and their commercial partnership seems to be on a slippery slope. The measures are particularly problematic for Argentina, as the country’s exports are mainly based on agricultural commodities and, specifically, soybeans.

Photo by Bill Thayer

Soy fields in cultivation.

This relationship started deteriorating when Argentina launched anti-dumping investigations on Chinese goods ranging from steel pipes to textiles. Dumping is the selling of goods in the another market at prices lower than the prices at which comparable goods are sold in the domestic market of the exporter. Such sales must cause or threaten material injury to a competing industry in the market. Since 2009, 63% of the anti-dumping investigations have been linked to Chinese imports.

It would be an understatement to say that China didn’t really appreciate its partner’s demeanour. “From the Chinese government’s point of view, the fact that Argentina has launched anti-dumping investigations so frequently against one country is totally abnormal and discriminatory,” the Chinese vice-minister of commerce, Jiang Yaoping, told the press agency Xinhua during a conference in Buenos Aires in April this year.

The soya crisis

Thus on 29th March, China decided to stop approving permits to import soybean oil from Argentina. The official reason remains that the solvent residues level in soybean oil imported from Argentina was higher than average. According to the Chinese authorities, this level was up to 300 parts per million (ppm) rather than the 100ppm normally authorised.

But others suspect ulterior motives, and believe the measures to be a response to the antidumping investigations. However, Ernesto Fernández Taboada, the executive director of the Argentine-Chinese chamber of production, industry and commerce, thinks that the real reason comes from the fact that China wants to produce its own soybean oil. “Their idea would be to keep buying soya in Argentina but not the oil,” he said.

In 2009, Argentina exported US$12bn worth of soya all over the world. The main recipient was China, receiving 72% of the total exports of soya grain and 45% of the total exports of soybean oil.

Soy also plays a crucial role in driving economic activity and as a source of tax revenue. Argentina’s total exports to China have grown sharply from about US$140m in 1992 to US$3.5bn in 2006 and US$6.3bn in 2007, making the Asian giant the country’s most important trade partner after Brazil.

Photo by Brian Funk

Ernesto Fernández Taboada.

These figures also prove that Argentina is particularly vulnerable to any downturn in demand for soya.

As a result, Argentine officials are trying to justify their politics and appease their Chinese counterparts. “We have just taken some antidumping measures to protect the national industry and the work of 600,000 Argentine workers,” said Débora Giorgi, the Argentine production minister, before adding, “China is one of our largest trade partners. All we want is to hold a healthy and respectful relation of healthy competition.”

How trade ties improved

The partnership started in 1984 with the creation of the Argentine-Chinese chamber of production, industry and commerce. At that time, the chamber included only 20 Argentine companies that exported to China. But this number has increased significantly over the years to 300 in 2009. “The trade has tripled in the decade 2000-10. Also, Argentina imports now new products such as leather, wool or olive oil,” said Taboada. In total, the volume of this bilateral trade reached US$12bn in 2009.

On the other side, the type of imports from China has seen an evolution over the years. “In the 1990s, we used to import a lot of textile. Today, the goods that come from China are mainly computers, electric and pharmaceutical products. But it’s important to specify that 50% of the Chinese products are not Chinese. They are actually made in China by international companies. That’s why China exports a lot of things,” explained Taboada.

Also according to Taboada, these products have a good reputation due to their quality. Although 20 years ago, China was renowned for producing only low quality items, today the country’s manufactures have improved their image. For instance, last year, the main electrical appliance supplier was China. The Asian country exported audio equipment, DVD recorders and players, refrigerators and freezers, and television sets to the detriment of traditional vendors such as the US, Italy or Chile.

Photo by Galio

Cultural factors play an important role.

But, on the other side, it doesn’t seem so easy for Argentine companies to get into the Chinese market. “The problem remains for medium and small companies. They have to face some financial issues – a trip to China costs more than US$5,000,” said Taboada.

Cultural factors also play an important role in the trade between the two countries. “The Chinese culture is totally different from ours. We don’t have the same relationship with Europe or the US than with China. The Chinese trade with people they trust. Consequently, it takes a while for the Argentine companies to go there and lay the foundations of confidence. The companies’ CEOs have to travel five or six times a year in order to meet their Chinese clients. If you multiply these trips by their cost, it means that the total amount goes up to US$30,000 or US$35,000.”

A significant cost then for the local firms and, especially for the agricultural sector that remains the principal exporter. That’s why Argentina is looking to boost and develop its exports in Asia. In January, the foreign minister, Jorge Taiana, went to China along with nearly 80 business leaders to develop the fast-growing Argentine mining sector. “The mining sector has grown quite a bit in recent years in Argentina, and Chinese business leaders are interested in investment opportunities,” he said.

Photo by kenhodge13

Offshore oil rig.

Investment in Oil Fields

It’s pretty clear that China doesn’t intend to restrict its business with Argentina to manufactured goods. In November 2004, the Chinese president, Hu Jintao, announced that China would invest US$20bn in Argentina over the next ten years. Today, it seems like China is gaining ground in investing in Argentine oil fields. The last biggest investment was closed by the beginning of March this year when Chinese National Offshore Oil Corporation (CNOOC) paid US$3.1bn for a 50% stake in Argentine oil and gas group Bridas Corporation.

But this deal is not particular to Argentina. The Asian country has developed many partnerships in South America. In 2008, Latin America absorbed 50% of the US$50bn China invested overseas. China also aims to finance long-term projects. In May 2009, it agreed to lend US$10bn to Brazil’s Petrobas in exchange for a guaranteed oil supply over the next decade. Brazil gave an undertaking to provide the Chinese state oil firm, Sinopec, with 200,000 barrels of oil a day.

China is not interested in a quick financial return but long-term results and supplies. On the other side, Argentina tends to protect its industries in regulating the trade with other countries. However, these measures have an important impact on the Argentine exports. The only challenge for the country is to fight its way back and to convince China to adjourn its sanctions.

But right now, the future of Chinese-Argentine trade relations remains uncertain.

Angry agricultural producers blocked main roads throughout the country today, protesting against government regulations on trading their produce. Representatives of countryside workers’ unions had wished to meet today in the Congress chamber and debate government retentions on agricultural goods, particularly soy.

When the scheduled hour for the session came, however, the opposition to the government were unable to assemble enough congressmen to pass a vote. Reports vary as to the exact numbers in attendance, but, despite the opposition’s efforts, between 106 and 110 places in the Congress chamber were occupied, falling short of the 129 necessary to conduct a valid vote.

Hugo Biolcati, president of the Rural Association of Argentina (SRA) expressed disgust at the prospect of the government setting up a fund with the tax imposed on soy. “It seems to make a mockery of democracy,” he complained. President Cristina Fernández de Kirchner proposed that the money would be redistributed to the provinces and municipal governments, but the people of the countryside continue to fear that they will lose out.

Following the failure to resolve the issue through debate, the people of the countryside occupied areas of the country’s main roads, causing traffic tailbacks of up to 5 kilometres in length. Alfredo de Angeli, president of the Agrarian Federation (FAA) in Entre Ríos, said that roadblocks were inevitable in the current climate.

Routes were cut off in Entre Ríos, Santa Fe, Córdoba and La Pampa. Route 14 was completely closed at Gualeguaychú. In other areas, interruptions have been intermittent. In Tucumán, traffic was interrupted on Route 9 every half hour.