Farmers give Argentina's President first major crisis

A demonstration in support of Argentina's government at the Plaza de Mayo in Buenos Aires (AP)

Cristina Fernandez, the former Argentinian First Lady turned president, is on a collision course with her country's all-important big farmers, provoking strikes, food shortages and clashes in the streets of Buenos Aires barely three months after she first took office from her husband, Nestor Kirchner.

Mrs Fernandez, like her husband, swept to office on promises of populist reform and institutional reform to make sure the country can never return to the military dictatorships of 30 years ago. In practice, however, she has disappointed many of her critics who hoped she would be more pragmatic than her sometimes doctrinaire husband, and outraged the farmers who grow the country's most valuable export – soy beans.

For the past three weeks, farmers have been on strike in opposition to a proposed tariff increase on soybean and sunflower seed exports from 35 per cent to at least 42 per cent. They have blockaded hundreds of roads, leaving Buenos Aires and other big population centres starved, not only of grains but also of the country's number one culinary obsession, beef.

The smaller farmers, in particular, have complained that they cannot make ends meet with the higher tariffs. However, feelings have become so frayed that when Mrs Fernandez's government proposed repealing the tariff increase for smaller producers, the farmers' representatives rejected her out of hand yesterday.

"The proposal is very unclear," farm workers' leader Ricardo Dagoto complained. "We still haven't seen any of the fine print."

A lot of the bad blood centres on a controversial pro-government protest leader called Luis D'Elia, who served in Mr Kirchner's cabinet and now acts as an unofficial proxy for the new president, motivated, he says, by "hatred of the whorish oligarchs".

When farmers and their supporters marched through Buenos Aires banging pots and pans last week, Mr D'Elia headed a group of counter-demonstrators who engaged the farmers in a fist-fight directly in front of a major government building. The very next evening, Mr D'Elia had a place of honour directly behind President Fernandez as she made a speech defending her soy tariff increase and urging the farmers to respect public order.

Officially, Mr D'Elia speaks for nobody but himself – he was thrown out of the Kirchner government for expressing support for Iran's radical regime – but he maintains an office in a government building, and many Argentines are enraged by his seemingly close association with the First Couple. "How can you tell the difference between the government and D'Elia if he is in charge of keeping public order with intolerably aggressive words and acts?," one columnist, Joaquin Morales Sola, wrote in La Nacion.

President Fernandez sees the new tariffs as part of her stated policy of redistributing wealth away from the big growers and the mercantile classes more generally, in favour of the poor.

She has dismissed the farmers' complaints as a "protest of plenty". However, the three-week standoff is beginning to bite hard for all Argentinians, pushing up food prices and leaving supermarket shelves half-bare.

Depriving Argentinians of beef is guaranteed to put people in a bad mood – the equivalent of taking pasta away from Italians or cheese from the French.

Some of the dispute is about the country's growing reliance on soy as a cash crop. This certainly meets growing demand for soy from Asia and provides the country with valuable export revenue, but it has also prompted concern about domestic food production; agricultural job losses; the wisdom of single-crop farming; and a panoply of environmental issues from deforestation to water pollution.

Mr Dagoto, the farm leader, said his union has always opposed the "soyanisation" of Argentina but that increasing export tariffs was not the way to go about it. "People don't understand many of us are just small-scale farmers," he said. "We need more government policies that distinguish between large and small producers and stimulate other agricultural activities."

Meanwhile, President Fernandez was preparing for yet another rally today to commemorate the end of Falklands war 26 years ago.