Drought Threatens Argentina’s Harvest; Chilean Court Blocks Lithium Tender

Bloomberg Línea — Argentina’s drought is likely to seriously impact its wheat and soybean harvests this year, with losses of up to nearly $3 billion anticipated, following a record harvest in 2021.

Chile has put the brakes on the tender of lithium exploration and extraction contracts after the Court of Appeals of Copiapó on Friday issued an immediate suspension of the national and international public bidding process. The process is opposed by President-elect Gabriel Boric, who will be sworn-in on March 11.

Following is a roundup of Friday’s news from our reporters across Latin America.

Argentina

A severe drought is already harming Argentina’s agricultural activity. After a record wheat harvest last year that exceeded 22 million tons, the drought generated by high temperatures and a lack of rain will impact soybean and corn yields throughout 2022, and could cause losses of $2.93 billion, according to a report by the Rosario Stock Exchange.

After data revealed that last year’s inflation exceeded 50%, both the government and economists have begun to set their sights on what could happen during 2022, with estimates pointing to 60% inflation this year.

Given the proximity of maturities owed to the International Monetary Fund (IMF), the Argentine government is negotiating with the lender against the clock for a new program. Next week, Foreign Minister Santiago Cafiero will travel to the U.S. to meet with Secretary of State Antony Blinken in an attempt to obtain Washington’s support, given the weight the U.S. wields in the multilateral bank.

Brazil

Brazil lost almost 12% of its bank branches in the first two years of the Covid-19 pandemic (2020 and 2021), with 2,324 disappearing during the period, according to Central Bank data.

Minerva Foods (BEEF3 has begun to take the first steps in search of a new home. The company headquartered in Barretos, in the interior of São Paulo state, will begin a series of studies to evaluate the feasibility of moving its domicile to another country.

Rio de Janeiro-based asset manager Squadra Investimentos reduced its stake in Espaçolaser (ESPA3) to zero before Brazil’s largest laser hair removal company completes a year-long debut on B3.

Chile

The Court of Appeals of Copiapó on Friday issued an immediate suspension of the national and international public bidding process for the exploration and exploitation of lithium deposits.

Chile on Friday reported 8,270 Covid-19 infections, doubling its cases compared to last Monday when the total was close to 4,000. Friday’s tally is the highest figure in seven months.

Colombia

In an interview with Bloomberg, the candidate leading the polls for the presidency of Colombia, Gustavo Petro, has called on ideological allies in Latin America and the world to join him and form a new bloc to move the economy away from fossil fuels.

Manufacturing output increased by 13.9% in Colombia in November, while real sales rose by 14.2% and the number of employed personnel by 5.2%, the country’s statistics bureau DANE reported on Friday.

Ecuador

The government is rolling out its so-called Ecuador Open for Business strategy to achieve $30 billion of investment by 2024 in mining, energy, hydrocarbons, infrastructure, tourism, telecommunications, real estate, cultural, environmental and health projects, among others.

93.2% of the energy generated by Ecuador in 2021 was renewable, based mainly on water resources due to the continuous operation of hydroelectric power plants such as Coca-Codo Sinclair, Paute, Sopladora, Minas San Francisco, Delsitanisagua, among others.

Mexico

Citigroup will immediately begin to separate the businesses it plans to divest in Mexico, to reflect the new accounting structure of the U.S. bank, which will also dispense with assets in Southeast Asia.

In 2021, the number of Mexican companies that issued thematic and sustainability-linked bonds tripled. According to data from the rating agency HR Ratings, last year, 18 companies made issuances on the local stock market, compared to six in 2020.

Peru

The Peruvian sol has maintained an upward trend against the U.S. dollar so far this year. According to the Central Reserve Bank, to January 14 the local currency had appreciated 2.7%, after the exchange rate reached a high during the second half of 2021.

This is how the region’s markets and currencies closed on Friday, January 14: