Hear
The total exports of beef They fell last May, reaching 55,300 tons of product weight, 7.8% compared to last April and 16.8% compared to the same month in 2023, according to a report carried out by the Meat Exporters Consortium (ABC). The data, according to the analysis carried out by experts in the refrigeration sector, reflects that China, the main destination for Argentine meat with 76.1%, is increasingly diversifying its purchases, increasing them for example in Brazil, a country that has just authorized a significant number of new plants for export.. This impacts the placements of the Argentine product: As an example, sales of frozen boneless meat, which were 25,162 tons last May, had been 29,259 in April. Further back in time, in February 2024 they climbed to 39,100 tons. In addition to China, there was less activity with other markets, such as Israel.
According to the ABC Consortium, meanwhile, considering the first five months of 2024, in terms of volume, total sales abroad were 13.3% higher than the same period in 2023, with 314,100 tons of product weight. In value terms, between January and May, business was done for 1,198.4 million dollars, an improvement of 1.2%.
In dialogue with THE NATION, Miguel Jairala, economic and market advisor of the ABC Consortium, explained that the fall in exports and also in the price [el valor medio de las ventas a China de carne sin hueso en mayo de 2024 se ubicó alrededor de los US$3354 por tonelada, lejos del máximo de US$5900 en mayo de 2022] It occurs in a context in which the Asian giant expanded its supply matrix. It comes from enabling 38 new production units to Brazil, increasing the number from 107 to 145. This included the authorization of 24 new beef processing plants, eight chicken processing plants, one thermo-processed beef establishment and five other establishments. Argentina has several pending authorizations on its list.
In addition, Jairala pointed out that China has lifted a ban on Ireland and added Colombia and Bolivia as new suppliers. “It is enabling more and more countries and within each of them it is expanding the number of establishments authorized to import meat. This expands the supply available to importers and can put downward pressure on prices,” he explained. He indicated, in this context, that Argentina is less competitive than neighboring countries. He gave as an example that while in Brazil a steer is worth US$2.60, in Argentina it is almost US$4. He clarified that although it is not the same quality meat, for China it is something that loses importance.
On the other hand, Jairala explained that the abrupt drop that climbed to 16.8% in exported volumes when considering May 2024 versus May 2023 was explained by the “super liquidation of cows” that occurred during last year’s drought, which generated greater availability of merchandise to China. “This year, with climate change, although the seasonal supply of cows is high, it is below what was recorded last year, which has reduced the availability of products for China, which is an important component in exports,” he stated.
Added to this situation is that, he indicated, shipments to Israel are “delayed” and will only restart this week. “Last year a little more work was done in May, but this year it started in June due to a tough price renegotiation. The ABC refrigerators indicated that they could not operate with those values, which caused a delay of a month. Now we are working with a price that shuts down the factories,” he said. In May, Israel took away 1,239 tons of frozen boneless meat, down from 2,900 tons in March.
On the other hand, the market that stands out for its growth is the United States. During the first five months of 2024, beef exports to that destination reached 12,800 tons, an increase of 62.1% compared to shipments made in the same period of the previous year. Jairala explained that this is due to a question of the livestock cycle. The northern country has the lowest livestock inventory in the last 50 years due to several years of forced liquidation due to lack of profitability, in addition to a significant drought last year in producing areas. “Now they are in the process of recovery, which means reducing shipments to the slaughterhouse and, therefore, they have less lean meat. On the other hand, Australia and New Zealand maintain their usual supply, while a lot of meat is coming in from Brazil and, to a lesser extent, from Argentina and Uruguay,” he said.
In this context, Jairala stressed the need to further diversify destinations to reduce dependence on China. He pointed out that Argentina should recover the number of plants authorized for Russia that it had more than 10 years ago. “Although at that time the market stopped being interesting, today it is more viable to sell medium-low quality meat to Russia at a competitive price than to China”, he expressed. “There are markets that we stopped serving in the 2000s before export closures [como las que hizo el kirchnerismo] and that we are currently not taking advantage of, such as North Africa, Egypt, Algeria, Tunisia, among others. These markets continue to buy meat, but now they buy it from countries like Brazil or India,” he added.
