New agriculture minister Ricardo Buryaile said January 20 that the European Commission would lift restrictions “in the first half of the year.”
This would allow livestock producers in the Chaco, Corrientes, Formosa and Salta provinces to resume exports, which have been blocked by the EU since 2003 following an outbreak of foot and mouth disease.
The European Commission’s health and food safety spokesperson Enrico Brivio told GlobalMeatNews that authorising fresh meat imports from the Argentine border region with Bolivia and Paraguay “is acceptable.” The process of resuming imports “will take a few months,” he added.
The region is the last within Argentina to become free of foot-and-mouth disease with or without vaccination, buoying expectations of boosting meat exports. “We want to take Argentine products to every country,” Buryaile said.
Argentina exported 228,249 tonnes of fresh and processed beef and offal in 2015, down 5.5% compared with 241,599 tonnes in 2014, according to Senasa, Argentina’s agricultural health and sanitation service (the servicio nacional de sanidad y calidad agroalimentaria).
Of the 109,140 tonnes in fresh beef exports (excluding high-end EU so-called ‘Hilton quota’ cuts) last year, 36% went to China, 19% to Chile, 15% to Israel and 12% to Russia. The biggest importers from the EU were Germany and the Netherlands, which bought a total of 6,972 tonnes of fresh beef as well as 15,842 tonnes of Hilton cuts, which carry lower import duties.
Javier Martínez del Valle, executive director of the Argentine Angus Association, an industry group, said the EU’s decision “is positive for Argentina”.
While the four affected provinces have about 10.6 million cattle, or a fifth of the national total of 51.6 million, according to Senasa, they produce heavier Braford and Brangus breeds above 480 kilos live weight. This will increase supply flows and product diversity – such as larger fillets and higher-yielding rib eye – for meatpackers when the trade restriction is lifted, Martínez del Valle said.
By comparison, farmers elsewhere have focused for years on selling lighter cattle to the domestic market, which consumes 93% of production, according to the Argentine Beef Industry and Commerce Chamber.
With the increase in available supplies from the north, “meatpackers will be able to increase the use of their installed capacity” for domestic sales and exports, Martínez del Valle told GlobalMeatNews. The EU’s decision comes at a time when the industry is preparing to expand stocks as business conditions improve. Argentina’s new conservative government of President Mauricio Macri, which took office in December, has eliminated export permits and a 15% export tax on the beef industry. The measures, coupled with the lifting of currency controls and a 40% devaluation of the peso against the dollar, have enhanced the industry’s export competitiveness.
“With the good news, ranchers have started to retain cattle for fattening and increasing herd sizes,” Carlos Vuegen, general manager of the Institute for Argentine Beef Promotion, told GlobalMeatNews.
The strategy will probably reduce the slaughter to 12.1 million cattle in 2016, down 2.4% from 12.4 million in 2015, he said. But it will make it possible for the industry to increase production with heavier cattle.
“This is a transition year,” he said. “The industry will be a better position to export more supplies in 2017.”