President Cristina Fernandez canceled a widely protested farm export tax hike on Friday following months of protest and a stunning rejection by the Senate.

Cabinet Minister Alberto Fernandez told reporters at a news conference that the government will comply with a Senate vote on Thursday rejecting the tax package. The Senate vote itself was not enough to cancel the tax hike because it has been issued by executive order.

The president announced the sliding-scale export taxes in March, hoping they would hold down prices by encouraging farmers to sell grains locally rather than take advantage of soaring export prices.

Farmers revolted, staging a series of food and transport strikes that disrupted the economy and eroded the president's popularity.

Farm leaders welcomed cancellation of tax hike.

"The conflict is over," said Luciano Miguens, head of the Argentina's Rural Society, to local television station C5N.

Wednesday's early morning Senate vote against the tax increase created divisions in Fernandez's Peronist party and her broader coalition, which controls the chamber.