"Then comes the desert": the government anticipates a foreign currency slump after the boost from agricultural exporters

The extraordinary inflow of foreign currency driven by the temporary reduction in agricultural withholdings generated significant relief in the foreign exchange market and the government . July is shaping up to be one of the best months in the history of the soybean-cereal complex, with sales exceeding $3.5 billion. However, this boost has an expiration date: starting this week, the 15-business-day period to complete sales with the tax benefit expires, and supply will begin to sharply decline.

Foreign Sales Declarations (DJVE) show a collapse in dollar inflows in recent weeks, following the peak of more than $8 billion recorded in June. This early export surge exposed a phenomenon that analysts describe as a "short blanket": what was liquidated now will not be available in the coming months, just when a surge in demand for foreign currency is expected due to tourism, imports, and pre-election dollarization.

Lorenzo Sigaut Gravina , director of the consulting firm Equilibra, explained that this acceleration amplified the market's typical seasonality: " What was sold now cannot be sold later. And that's a problem in a free-floating system without intervention ." Added to this is the fact that the Central Bank , as it does every year, faces a more demanding third quarter in terms of debt payments and pressure on the exchange rate.

Although the ruling party has maintained its stance on floating the exchange rate, the interventions of recent weeks reveal a careful strategy to prevent the dollar's surge from spilling over into prices. When the blue and official exchange rates reached record highs in just days, the government responded with interest rate hikes in pesos, passive repurchase agreements, and an active presence in futures markets. The objective: to avoid inflationary spirals like those that marked years of Kirchnerist mismanagement.

Despite the expected decline in the agricultural export liquidation, the outlook is not necessarily catastrophic. According to Gustavo Quintana , a trader at PR Cambios, " there are other sectors that are performing well in exports, such as energy and mining ." The recent improvement in the energy balance—supported by official data—opens the door to partially offsetting the fall in agricultural foreign currency.

However, analysts warn that the dollar could continue its upward trend, especially with the upcoming elections. Claudio Caprarulo of Analytica argued that the key issue is not the dollar's nominal value, but rather that its trend remains within the range and without a direct impact on inflation. " So far, the pass-through to prices has been very low. This allows some room for the exchange rate to recover without generating instability ," he explained.

Beyond the optimistic statements, the data that most worries analysts is that the dollar continued to rise despite record supply. Salvador Vitelli , an economist specializing in agribusiness, warned that "the sector's microeconomics have come to a standstill" and that the current dynamic resembles that of the 2022 "soybean dollar": temporary peaks, followed by a prolonged silence. " Although energy can contribute, supply will fall, and we are already seeing that dollars are not enough ," he warned.

Consultant Javier Preciado Patiño was even more forceful: " After July, the desert comes ." He explained that exporters have already declared and settled virtually everything planned. And with the return to the usual system—in which withholdings are paid between 5 and 15 days after declaring or shipping—no further boost is expected. Seasonality, lower supply, and growing demand from tourism, consumer spending, and electoral uncertainty all predict a more tense two-month period for the dollar, which the government is seeking to manage with balance and firm signals to the market.