Argentina launches relief fund for farmers hit by historic drought

BUENOS AIRES, Jan 31 (Reuters) - Argentina will launchmeasures to help producers hit by a historic drought over itsmain agricultural region, Economy Minister Sergio Massa said onTuesday, including a relief fund to tackle considerable lossesto the country's grains harvests.

The ministry will give producers access to a 5 billion pesos($27 million) relief fund, Massa said after a meeting with theSouth American country's main rural associations.

Argentina is the world's leading exporter of soybeanprocessed oil and meal, and the world's No. 3 corn exporter, butthe drought that began in May delayed farmers from plantingtheir crops while grains exchanges slashed estimates.

Massa also announced other measures, such as the suspensionof advance income tax payments for producers in areas hardesthit by the drought, smaller interest rates, and biggersubsidies.

Recent rains have brought needed relief to much ofArgentina's parched agricultural land, but the country's wheatharvest ended at a little over half the previous cycle's output.

"I know this is not necessarily everything they asked for,"Massa said in a statement. "It's what we can do at this time."($1 = 186.9800 Argentine pesos)(Reporting by Eliana Raszewski; Writing by Carolina Pulice;Editing by Sarah Morland and Chris Reese)

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