BUENOS AIRES, ARGENTINA — Argentina announced on Aug. 25 that it has formed a new government agency to manage dredging operations on the Parana River, which carries about 80% of the country grain exports and has recently seen its water level drop significantly due to drought, Reuters reported.
“The strengthening of policies on the management of inland waterways is a priority objective of the national executive,” the government said in a decree published this week.
The decree was met with skepticism from the private sector and farmers who fear that government intervention will make shipping grain less efficient and more costly, according to the Reuters report.
“This decree looks like the government does not only want to set up conditions for the tender and the dredging tariff,” Gustavo Idigoras, head of the CIARA-CEC export companies’ chamber, told Reuters. “It looks like an excess of bureaucracy that might mean additional costs for export operations on the river.”
Under the current system, cargo ships pay tolls directly to the private dredging company in charge of keeping the river open.
One of the worst droughts in decades has lowered the Parana River in Argentina and Brazil to its lowest level in many years, causing the pace of grain exports to slow.
Argentina is the world’s top exporter of soybean meal and the No. 3 exporter of corn.