BUENOS AIRES (Dow Jones)--Argentine soy prices posted sharp losses on the
week as the sell-off in U.S. markets weighed on local prices.

  Talk of the U.S. government stepping in to increase regulation of speculative
investment in commodities sparked an unloading of international crude oil
futures, which weighed on Argentine soybeans, said Roagro analyst Carlos
Boglioli in a market note. Soybean prices are influenced by crude as they are
the main feedstock for biodiesel in South America.

  Local soybean prices are searching for a new floor amid a complicated market
"slow to react to [overseas] gains and quick to react to drops," Boglioli said.

  Trade on Wednesday was muted ahead of the national July 9 holiday Thursday
and with an empty floor due to A/H1N1 flu precautions, the Rosario exchange
said. Trade has been conducted by telephone since last week, when live trading
was suspended amid the rapid spread of the so-called swine flu in Argentina.

  Spot soybeans were traded at between ARS910 ($236) and ARS940 a ton in
Rosario on Wednesday, down from between ARS1,005 and ARS1,030 a week ago.

  May 2010 soy futures traded at $213 a ton, down from $225 to $227 a week ago.

  Meanwhile, spot wheat and corn weren't traded for the third week running as
sellers wait for exporters to come in with the new, higher prices agreed with
the government.

   Corn


  Spot corn was last traded at ARS435 per ton at the Rosario Grain Exchange on
June 17.

  Corn futures weren't traded either on Wednesday.

  Trade stalled as exporters are hesitant to buy at the government's set price
and farmers refuse to sell at a lower price, according to the exchange.

  On June 16, Argentina's grain exporters reached a deal with the government to
buy up to three million metric tons of 2009-10 corn and an additional one
million tons of new crop wheat at a theoretical price set by the government. In
exchange, the exporters will be ensured export permits for the surplus wheat
and corn from the 2009-10 crop.

  On Wednesday, the government's theoretical price that farmers should receive
for spot corn was set at ARS459 per ton. That theoretical Free-Alongside-Ship
price is the Free-On-Board price minus export taxes.

  The new deal is expected to boost local corn prices, which have been trading
at a discount due to a risk premium because of the government's intermittent
closing of exports.

  Still, stocks of wheat and corn over domestic demand will have to be
confirmed by the agricultural trade office, or ONCCA, before the exports will
be approved. The deal will start with exporters buying one million tons of
corn, at which time the government will consider extending the deal for the
additional two million tons.

  The agreement follows a similar deal struck in May for one million tons of
2009-10 wheat exports.

  The government hopes the new agreement will stimulate wheat and corn planting
this season amid signs that the area planted with the crops will fall sharply
as farmers continue a major shift to soybeans.

   Wheat


  Spot wheat last traded at ARS654 on June 18. The government's theoretical FAS
price on Wednesday was ARS661 per ton.