02/21/2013| 02:59pm US/Eastern
By Shane Romig
BUENOS AIRES--Argentina's January trade surplus narrowed to $280 million, down sharply from the $550 million surplus posted a year earlier and the $530 million surplus reported for December.
Exports in January totaled $5.67 billion, down from $5.91 billion a year earlier, national statistics agency Indec reported Thursday. Imports in January were relatively flat on the year at $5.39 billion, compared with $5.36 billion a year earlier.
The slip in exports was largely due to lower farm shipments after a drought hit the 2011-12 crops. The 2012-13 soybean and corn crops will start making their way to market in March, providing some relief to the trade balance and to the government's efforts to build reserves and stabilize the peso exchange rate.
The trade surplus is the single biggest contributor to Argentina's international reserves in the absence of significant levels of foreign investment and offshore borrowings by the government and Argentine companies. President Cristina Kirchner uses a portion of those reserves to pay government creditors.
In 2012, Argentina's trade surplus rose 27% to $12.69 billion as restrictions on imported goods and services more than offset a decline in exports. Exports fell 3% last year to $81.21 billion, while imports fell 7% to $68.5 billion.
Since late 2011, the Kirchner administration has aggressively limited imports and imposed severe currency rationing on the public to make sure the central bank has enough dollars on hand for the government to its debts and Argentine industry can buy critical imports.
Those import barriers led the European Union, the U.S. and Japan to file disputes against Argentina at the World Trade Organization last year.
The federal budget forecasts a trade surplus of about $13.3 billion this year, based largely on expectations for bumper soybean and corn crops.
Argentina is the world's No. 3 soybean exporter and the leader in soyoil and soymeal exports. It also ranks No. 2 in corn exports.
--Alberto Messer contributed to this article.
Write to Shane Romig at shane.romig@dowjones.com
