Farm distrustful extends strike for 48 hours

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Argentine farmers vowed on Wednesday to continue protesting a soy export tax, extending a bitter three-month dispute with government that had seemed to abate earlier in the day.

Center-left President Cristina Fernandez rallied thousands of supporters in the capital on Wednesday afternoon after moving to appease farmers by asking Congress to ratify her controversial soy tax.

The conflict, including blockades by farmers and nationwide protests against government, has eroded Fernandez's popularity and pushed Latin America's No. 3 economy into its deepest political crisis in six years.

But farm leaders rejected the president's soy export tax bill because it was presented to lawmakers for a "yes" or "no" vote without any possibility of modifying the tax, which they say could put small growers out of business.

"We don't agree with the bill the way it was sent. We are asking that it be opened up so that lawmakers can agree on changes," Eduardo Buzzi, head of one of Argentina's four big farm groups, said at a news conference with the other leaders.

Buzzi said farmers would continue protests through Friday, holding back grains from export markets.

But he said they would not block highways or disrupt local food supplies, measures government has severely criticized.

FREE UP THE ROADS

At the rally, which the government billed as a defense of democracy, a sea of banners in the blue-and-white national colors filled the square in front of the pink presidential palace.

"Free up the roads, let Argentines get back to work," Fernandez told the rally. "We have to learn once and for all that we've got to overcome our differences democratically."

Fernandez criticized farm leaders in her speech, but refrained from calling them "coup leaders" as she has in the past.

The demonstration sought to counter anti-government protests that erupted across the country on Monday, when thousands of people banged pots and pans in scenes reminiscent of the devastating economic and political crisis of 2001/2002.

"This government saved me," said Hector Lagomarsino, 55, a factory worker who was forced to earn a living doing odd jobs after he was laid off in 2000 and went to the rally to support the president. "We've have had a lot of problems but now there's work. We've got to defend that."

Argentina recovered rapidly from its meltdown but the farming standoff has cast a cloud over five years of robust growth and raised fears of a hard landing.

Argentine stocks and bonds, hit by uncertainty over the conflict, were firmer on Wednesday and U.S. soy futures fell due to expectations of a resolution.

'WAKE-UP CALL'

Argentina, like many other Latin American countries rich in raw materials, is struggling to reach a national consensus on how to distribute windfall profits from soy. Prices for the oilseed have soared on high demand from Europe and Asia.

Fernandez, who took office six months ago, has defended the tax increase as a way to redistribute the bounty of high global food prices among the poor and to fight inflation.

Argentina is one of the world's biggest providers of soybeans, corn, wheat and beef but nearly a quarter of the population lives in poverty.

Political analysts said Fernandez's decision to refer the tax hike to Congress for ratification marked a turning point in the conflict.

But after farmers rejected her gesture and said they would set out to lobby lawmakers to change the tax, it was not clear whether the president had managed to win the upper hand.

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