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MoneyShow: Why Argentina Is Latin America’s Hidden Treasure

On December 14, 2010, In a-bric, foreign investment, by InvestBA
BBVA Argentina

BBVA, one of MoneyShow's picks, understands Argentine consumers like to hide their personal treasure.

A confluence of good news yesterday on several fronts: The market price for Argentina’s three major AgExports rose, the country risk fell another 3.5%, LCD prices have fallen 30% since the World Cup and debt repayment negotiations began in earnest with the Paris Club.

Despite the onda positiva, it’s important to remember that each of these indicators is highly volatile and subject to external variables like extreme weather, unforeseen risk, punitive tariffs and French egos. So what about something more tangible, more long-term, more big picture to hang our collective hopes on?

MoneyShow and Carla Pasternak’s Global Perspectives to the rescue. Pasternak, director of income research for High-Yield International, scours the globe looking for income plays in developing countries, and she certainly seems fond of Argentina. “A Hidden Treasure,” “the fastest-growing country in the region,” and “the booming country” are just three of the cumplidos macroeconomicos she sends Argentina’s way.

True, inflation is above normal and investor confidence was crippled a decade ago with the $95 billion default but, writes Pasternak, “The good news is all that is in the past. Argentina is in the midst of an economic revival.” One of the keys to success is the shifting nature of Argentina’s external dependence away from the Untied States and rapidly towards BRIC nations like Brazil which imports the majority of Argentine auto production, China which has joint ventures stretching from Tucuman to Tierra del Fuego and India which continues to broaden bilateral relations with Argentina. (Full Story)

For more information about Argentina investment opportunities, download the new issue of InvestBA Privada.

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Argentina Auto Production Closing In On Record Year

On September 7, 2010, In a-bric, competitiveness, foreign investment, by InvestBA
VW Amarok in Argentina

VW recently launched the Amarok in BA; the company's Pacheco plant can produce 30 cars per hour.

What a difference a year makes. The Argentina automotive sector was on the ropes in 2009 after a dismal year, but 2010 has been much improved thanks to continued economic strength and consumer demand across the border in Brazil.

When we last looked at automotive output six months ago, there was cause for full-year 2010 optimism: February production was up 170% compared to February 2009. Now the mid-year data released yesterday shows strength on both domestic sales and exports to Brazil; the former have recovered to 2008 levels while the latter is up 54% for January-July 2010 vs. the same seven-month period in 2009.

26noticias credits the rise in domestic sales to higher consumer confidence and more financing options. Of the 267,000 automobiles Argentina exported in the first eight months of this year, a whopping 86% went to Brazil. If domestic and international demand remains strong, Argentina is on target to produce 685,000 vehicles this year, a figure that would exceed the last production record set in 2008.

The export numbers would also tip Argentina’s trade deficit with Brazil into a surplus. One potential hurdle to breaking the record: Brazilian new auto demand is leading to a parts shortage in Argentina. The industry report says auto parts suppliers will need to ramp up production in order to bring parts supplies back into equilibrium. (Full story in Spanish)

For more information about investment opportunities in Argentina, download the new issue of InvestBA Privada.

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LAN Airlines, Argentine Growers Build A Blueberry Bridge

On September 2, 2010, In competitiveness, energy & agriculture, foreign investment, by InvestBA
Blueberry Bridge

Fresh, not Frozen: BA, Entre Ri­os and Tucuman have ramped up U.S. blueberry exports with LAN Cargo.

Global demand for strawberries and blueberries has been on the rise, which is good news for the three Argentine provinces that produce the bulk o’ the berries: Buenos Aires, Entre Rios and Tucuman.

And while Argentina is South America’s third largest exporter of strawberries (after Brazil and Chile), she’s moved up to number two (behind Chile) on the blueberry chart. Agronomy engineer Daniel Kirschbaum told La Gaceta that blueberry demand is up thanks to the fruit’s many nutritional and aesthetic qualities.

Kirschbaum, an INTA director and University of Florida IFAS graduate, says blueberry production is creating both jobs and foreign investment in Argentina with greater quantities now being exported at more competitive prices. Argentina’s competitive edge is also a success story in logistics for both Tucuman and LAN Cargo.

“Thanks to the agreement with LAN we could open to U.S. markets, since the export duration is only 20 hours,” said Tucuman Governor Jose Alperovich. LAN Cargo General Manager Carlos Larrain says his company is now “the bridge between the fruit harvested in Tucuman and served one day later on the tables of Americans.”

FreshPlaza.com published the export numbers, while the Buenos Aires Herald has a more in-depth piece on “The Blueberry Route” between Tucuman and Miami. ThePacker.com says Tucuman and Concordia have just come through the coldest August on record, so the route may ramp up a little slower this year.

For more information on Argentina agribusiness opportunities, see our archives and download the new issue of InvestBA Privada.

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A Closer Look at Argentina’s Silver Lining…Silver Mining

On June 2, 2010, In energy & agriculture, foreign investment, real estate, by InvestBA
Pan American Silver Mine in Argentina

Argentine workers enter the Melissa Underground Mine operated by Pan American Silver Corp.

Whether its G. Gordon Liddy or the guy who Matt Damon beat up in Good Will Hunting, you can’t turn on the TV without being bombarded by gold pitchmen. And while yearly gold charts look like the left side of a mountain, the rise in silver prices over the past two years is equally impressive.

Marc Davis of BNW Newswire says the impetus for greater silver exploration is definitely there, but we’re just not seeing it worldwide…with one notable exception. “Argentina posted a 55% jump in silver output in 2009 to 15.5 million ounces over the previous year.

One of the world’s few remaining stable democracies that is mineral-rich but underdeveloped, this geographically large Latin American nation is set to continue to ramp-up its output in the coming years,” writes Davis.

He says the major players in the region are three Vancouver-based companies: Silver Standard Resources (NASDAQ: SSRI), Pan American Silver Corp. (NASDAQ: PAAS), Extorre Gold Mines (TSX: XG) and Australia’s Andean Resources (TSX: AND).

Davis explains why silver is a good play going forward: “A number of key 21st century applications such as solar panels and flat screen television panels are forecast to contribute strongly to heightened demand. Furthermore, the marketplace for semiconductors, which are used in an array of portable electronic devices and other high-tech applications, is experiencing explosive growth.” (Full story at Resource Investor)

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Agricultural Exports, Farm Loans Surge in Argentina & Uruguay

On April 26, 2010, In a-bric, energy & agriculture, foreign investment, uruguay, by InvestBA
http://investba.com/2010/01/more-rain-efficiency-mean-bumper-crop-in-ba/

Argentine soy farmers are earning record profits. So are the cattle producers in Uruguay.

As farmers in Argentina and Uruguay ride a wave of recovery, exports are booming and banks are poised to increase lending dramatically, according to Bloomberg.

We’ve covered the bullish forecasts regarding this year’s corn and soy crops, and now it appears the banks have taken notice. “Banco Galicia, Argentina’s second-biggest farm lender, expects agricultural loans to increase about 40 percent this year after no growth in 2009,” says Bloomberg, while “HSBC forecasts an expansion of as much as 30 percent to a record volume.”

Argentine farmers are expected to produce 54.5 million metric tons of soybeans and 21.4 million tons of corn this year, annual increases of 65 percent and 69 percent from 2009. Bankers and farmers are equally optimistic given the record harvests coincide with an improving interest rate environment.

Across the river, cattle farmers in Uruguay continue to fill the gap left by falling production levels in Argentina. Beef exports from Uruguay rose 27% in March to 203,465 tonnes compared to March 2009, according to Meat Trade News Daily. 40 percent of Uruguay’s beef exports went to Russia and Asia with Russia demanding 90 percent more beef and Asian markets buying 122 percent more Uruguayan beef compared to 2009.

According to Ag Weekly, “the USDA increased production estimates of soybean crops from Brazil and Argentina, the world’s No. 2 and No. 3 producers, but said strong demand from China will help consume the bumper crops. “

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