Argentina's use of Chinese yuan is soaring as dollars run short, and a top US manufacturer may join the trend

• Argentine companies are increasingly turning to China's yuan amid dollar shortages, Bloomberg reports.
• US giant Whirlpool is also considering use of the yuan to buy parts for a factory in Argentina.

US dollars are a growing rarity in Argentina, pushing many in the country to seek out the Chinese yuan instead.

The South American county's central bank dollar reserves are at their lowest level since 2016, due in part to a drought that destroyed about $20 billion in crop exports, according to Bloomberg.

That has complicated international trade, given that the dollar is the most widely used currency for global transactions.

But it has opened the door for China's yuan, which Beijing has been trying to internationalize as an alternative to the greenback. Argentina and China have had a bilateral swap agreement since 2009, and Beijing recently allowed Argentina to tap over half of a $18 billion currency swap line, Bloomberg said.

Yuan transactions in Argentina's currency market totaled about $285 million during the first 10 days of June, double the volume in the entire month of May.

Meanwhile, the share of daily yuan transactions in Argentina's FX market recently hit a record high of 28%, up from May's high of just 5%.

The upswing comes as over 500 companies in Argentina are looking to pay for imports in yuan, according to Bloomberg.

And US giant Whirlpool may join them. The manufacturer opened a $52 million plant in Argentina last October, but the lack of dollars has disrupted activity, as it delayed imports needed to manufacture washing machines and other appliances.

"We've had to stop the factory at some points and that's not good for business, productivity nor quality," Juan Carlos Puente, president of Whirlpool Latin America, told Bloomberg.

Whirlpool did not immediately respond to Insider's request for comment.

But Argentina hasn't given up on the dollar. The government is discussing dollar aid from the International Monetary Fund.

And the country could go even further. The leading presidential candidate has proposed ditching the peso and fully adopting the dollar as Argentina's local currency as a way to rein in inflation.