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BUENOS AIRES, Aug 12 (Reuters) - Argentina's key grains export sector became instantly more competitive on Monday when the local peso weakened over 15% against the U.S. dollar, but farmers said they would wait to see where the currency settles before selling.
With some analysts forecasting an even weaker peso ahead and growers fearing a return to interventionist economics under the opposition Peronists, selling was muted as Argentines processed President Mauricio Macri's shockingly poor primary performance against challenger Alberto Fernandez.
The peso crashed against the greenback after Macri got thumped by Peronist Fernandez in Sunday's primary vote, a stark early warning for the incumbent 2-1/2 months ahead of the Oct. 27 general election.
A weaker Argentine currency helps local growers, who receive dollars for their exports while paying farm costs in pesos.
"But no one will sell grains on the first day of a currency crisis, because the peso could get even weaker tomorrow," local agro-industrial analyst Pablo Adreani told Reuters.
"The uncertainty is total," he said.
As the main political parties had already chosen their presidential candidates, the primary served as a grand opinion poll, revealing voter preferences ahead of the general election.
"The market will look for a new base in coming days. Farmers will wait before selling," said Gustavo Idigoras, head of the CIARA-CEC chamber of grains exporters.
Macri won office in late 2015 with wide support from the farm sector. The president himself said he was shocked by the wide margin - more than 15 percentage points - of his loss.
"I need some time to see what we are going to do," one grower said by telephone from his farm in the bread-basket province of Buenos Aires, admitting he was surprised by the severity of Macri's defeat on Sunday. "Call me in a few days."
Macri, an advocate of free markets, has seen his popularity tumble since cutting public utility subsidies, which spurred higher electricity and heating gas bills.
The peso on Monday initially dropped 30.3% to a record low of 65 per U.S. dollar, but partially recovered later in the day to trade at 53.5 per dollar.
"Argentine grains gained a lot of competitiveness today," said a Buenos Aires-based grains export company executive, who asked not to be named due to the high sensitivity of the situation.
But the impulse to sell was tamed by uncertainty, traders said.
Macri started his administration in late 2015 as a hero of the farm sector. Previous President Cristina Fernandez de Kirchner had feuded for years with growers over her policies, which included strict export limits on corn and wheat, of which Argentina is a major global supplier.
Kirchner, who imposed high export taxes on farm products during her 2007-15 presidency, is now running for vice president on the Fernandez ticket. To avoid a fiscal crisis, Macri reinstated some of the taxes he had once criticized.
"What this means today is it stimulates production. What we don't know is if there's a chance they put (more) export taxes back on somewhere down the road," said Dan Basse, president of AgResource Co in Chicago.
With Macri seen as unlikely to come from so far behind and win a second term in October, the markets waited for Fernandez to outline his policies in depth, and float the names of possible ministers. He and his running mate Kirchner have both said they favor a more active role by government in the economy.
"The possibility that Argentine grains and oilseed export volumes will continue to grow will depend on the rules of the game that are established for the sector going forward," said Ezequiel De Freijo, head economist at the Argentine Rural society, which represents some of the country's biggest farmers. (Reporting by Hugh Bronstein; additional reporting by Karl Plume, editing by G Crosse)