Many Argentines sip mate daily. The brewed, bitter drink is made by infusing leaves of the yerba mate plant, a relative of holly. It is grown by some 13,000 farmers, mostly on a small scale across 230,000 hectares (568,000 acres), predominantly in the northern province of Misiones.
Argentina’s president, Javier Milei, deregulated the industry in December 2023, ending the power of the National Institute of Yerba Mate (INYM) to set minimum prices. Now growers are struggling. Prices for their crop have dropped by more than 50% in real terms. “It doesn’t cover costs,” says María Ferreira, a yerba mate grower, sitting by a road in Misiones. She and other growers say they are now at the mercy of the ten mills that buy, grind and package more than 70% of the supply.
They have been here before. The industry was regulated for nearly 60 years until the then-president, Carlos Menem, dissolved the commission that set planting limits in 1991. Subsequent overproduction saw a steep decline in prices over the next decade. Farmers blocked roads with their tractors in protest and in 2002 regulation returned with the creation of the INYM.
The institute’s 12 directors, from different parts of the supply chain, set minimum prices through unanimous agreement. The federal government arbitrated disagreement. “Artificially high” prices resulted in over-planting, says Gerardo Alonso Schwarz, an economist in Misiones. In recent years the INYM began to limit how much could be planted. “The reality is that the regulatory entity that could have controlled the cycles didn’t do it,” he says.
Argentina’s deregulation ministry has applauded the reduced price that consumers are paying for their brew, which in November was 30% lower in real terms than a year earlier. Industry leaders attribute the 50% price reduction that some farmers have seen to an improved growing climate, and to the use of the black market. “Many producers don’t want to pay taxes, so they sell to other people who pay them less,” says Victoria Szychowski, who runs the Amanda mate brand.
María Soledad Fracalossi of the INYM has encouraged farmers to diversify their crops. Although a federal court has ordered the suspension of Mr Milei’s deregulation measures with respect to yerba mate, Ms Fracalossi says the INYM cannot set prices until all of its directors’ seats are filled. The federal government appoints its president. It has not done so.
Strikingly, even though growers are upset, many don’t harbour hard feelings towards Mr Milei; his budget cuts have helped the country reduce inflation dramatically. Jorge Lizznienz, a second-generation yerba mate farmer, says that the libertarian has given Argentines hope. When it comes to yerba mate though, he ventures that “the president of the country is being badly advised.” ■
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