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Businesses Hightail It out of Argentina

argentina

A huge Argentine agribusiness has just fled the country for Brazil. The FT reports that high inflation and skyrocketing land costs have pushed El Tejar to move to land the company bought in São Paulo:

The sharp increase in land rental costs in recent years in Argentina has meant that despite the rise in grain and oilseed prices, the company’s margins have been squeezed, forcing a strategic rethink of its business model. Owning rather than leasing agricultural land has been a way to gain control of productivity and profit margins, say people who know the company well.

El Tejar isn’t the only company to pack its bags and skip town. According to the FT, other important Argentine agribusinesses are shifting some of their operations into Brazil, “including Los Grobo, Cresud and MSU”, which “have expanded beyond borders in recent years, taking advantage of the plentiful land supply.”

We’ve written before about the depressing cycle of Argentine economic failure. Sadly, it doesn’t appear the country will break this cycle anytime soon.

[Argentinian flag courtesy of Shutterstock]

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  • cubanbob

    Until Argentines wake up and finally bury Peron and Peronism the country will remain a disaster.

  • http://www.facebook.com/southwestern.songdog Southwestern SongDog

    Argentina is trapped in Peronism and will flounder until it is decisively rejected. You’d think they would learn from the experience of their neighbors, Chile’ and Brazil. But no, the government must control everything including most prices, and we all know how that turns out.

  • bittman

    Will this happen in the USA by 2016 if we continue on our current path?

  • bobofromtexas

    Argentina is Hope&Change! on steroids.

  • AD_Rtr_OS

    Sounds like CA v. TX!

  • bitterclingerxxxx

    The same socialist morons that vote for Obama here vote for that wacko leftist lady in Argentina.

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