The Argentine portion of the soybean commodity chain

Abstract

Since the 1990s the soybean crop has increased in the Southern Cone of Latin America (LA). During this time, Argentina, Brazil, Uruguay, Bolivia and Paraguay have become soybean producers. This phenomenon was influenced by the rising soybean demand from China for use in animal feed as the country changed its diet patterns. South American soybean exports to China constitute an important percentage of the bilateral commerce. Basically, two views can be identified with regard to China’s relations with LA countries. One of them emphasizes opportunities for building mutually beneficial relations and underscores the economic complementarity between both regions. Yet, the critical literature on China and Latin American relations draws attention to the contradictions of this process by highlighting the deepening of neo-extractivism and the expansion of the agricultural frontier. Describing the Argentine portion of the soybean commodity chain this paper will present data to support this critical literature. It depicts the actors, strategies and the degree of monopolization of each of the nodes of soybean production based on secondary data. The article’s key findings are as follows: (1) there is high monopolization and foreignization of soybean production and commercialization; (2) as China has become a global player in genomics and agrochemicals, it has reproduced the same patterns as the core countries; (3) despite the win-win diplomatic statements of the People’s Republic of China, there are important asymmetries in trade, and the Argentine deficits have continually increased; (4) by expanding GM soybean production, Argentina has augmented the concentration of land, primarization and transnationalization of the economy and monoculture; (5) the Cristina F. de Kirchner progressive government failed to stop soybean expansion, and with the drop of the economic growth rate that is associated with the fall of commodity prices combined with the restriction of access to international credits, the government was put in check by various fronts. The distributive conflict contributed to the increasing social confusion that led to a right wing recovery in 2015. Therefore, this article shows that China’s increasing trade with Argentina in the soybean sector follows the existing structure of the global commodity chain and does not offer much space for progressive change in Argentina’s political economy. The data that are presented demystify Chinese win-win statements and counter expectations about China as an alternative globalizer that would bring more benefits to the global South than traditional core countries have.