Argentine farm tax crisis worsens

A strike by Argentine farmers over rising taxes on major export goods has entered its third week, with little sign of resolution, reported The BBC.

Blockades by farmers have led to shortages in the shops and have also hit exports, with some companies saying they cannot fulfil their contracts.

The government says the tax increases are justified and it will use force if necessary to get food to the markets.

Rival demonstrators rallied in Buenos Aires overnight amid some scuffles.

The latest crisis was sparked by the government's decision to introduce a new sliding scale of export taxes, raising levies in some cases up to 45%.

President Cristina Fernandez has refused to back down, saying the taxes are a means to raise badly-needed revenue, curb inflation and guarantee domestic supplies. "The government is not against the farm sector. Farmers' profits have never been as high as they are today," her chief of cabinet, Alberto Fernandez, said on Wednesday.

Argentina, a leading exporter of beef, corn, soyoil and soybeans, has benefited from the recent global surge in commodity prices.

But farmers say the taxes are hitting them and their communities hard.

"Our profit margins are getting smaller and smaller. What we pay to the state is not returned to us in the form, for example, of subsidies to buy fertilizers or to promote the social and educational development of our communities," Marcelo Rasseto, a small farmer from Santa Fe province, told the BBC.

Protesters have been stopping lorries carrying farm produce and either turning them back or dumping their goods on the road.

Trade at grain and cattle markets has also been disrupted, while several suppliers of Argentine soy and soy oil to China have been unable to fulfil export contracts, industry officials told Reuters.

The farmers' action has also led to meat and dairy shortages in the shops.

"The government will take the necessary measures to ensure there are no shortages... We have to guarantee people's food supplies," Economy Minister Martin Lousteau said.