COMMODITIES-ARGENTINA: Juicy Outlook for Beef Exports

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, Feb 12 1997 (IPS) - Encouraged by success in combating hoof-and-mouth disease and capitalising on the misfortunes of others, Argentina’s ranchers have set out to reconquer the world market, over which they reigned until the early 1970s.

Argentina, whose rich pastures helped it become the world’s top exporter of beef until 1971, lost its privileged position due to hoof-and-mouth disease, and was overtaken by Australia, the United States and New Zealand.

Today, on the verge of being declared free of the disease by the Paris-based International Epizootiological Office in May – there have been no outbreaks since April 1994 – Argentina is also benefiting from the impact of “mad cow disease” – Bovine Spongiform Encephalopathy – in Europe.

An official delegation from Russia, Argentina’s top buyer until 1984, visited Buenos Aires this month to clinch a deal, and the United States has assigned Argentina a quota of 30,000 tonnes, a small but significant indicator of renewed confidence.

In 1995, Argentina exported 516,000 tonnes of beef. In 1996, that figure dropped to 465,000 tonnes, due to a decline in consumption in Europe resulting from fear of the mad cow disease. While this year’s exports are expected to be similar to last year’s, significant improvement should be seen in 1998.

Alberto de las Carreras, an expert on the beef trade and author of the book “Hoof-and-Mouth Disease in Argentina”, told IPS that “success against the disease already began to show effects on a small scale in the last year.”

Argentine beef is now hitting tables in South Africa, Croatia, Slovenia, the Philippines, Malaysia, Thailand and Singapore. But the big challenge is Japan, South Korea and Taiwan, the top consumers in southeast Asia, a region that consumes around 1.5 million tonnes a year, a quarter of the beef sold worldwide.

Consumption doubled in Japan since the 1980s, and is expected to rise to 1.3 million tonnes by early next century, thanks to a change of eating habits among the younger generations.

It also rose twofold over the past decade in Vietnam, a country of 70 million inhabitants that buys Argentine beef.

Argentina aims to use Vietnam as a springboard to the rest of southeast Asia, according to executives of Swift Armour, an affiliate of the U.S. company which exports 170 million dollars a year.

But Japan, South Korea and Taiwan are not interested in beef from Argentina until it can do without the vaccine against hoof- and-mouth disease, as do neighbouring Chile and Uruguay, said beef trade expert De las Carreras.

That will only be possible ‘

The World Trade Organisation accepts that criteria in certifying the quality of a product. “For that reason, continuing to demand that the country must be able to do without the vaccine is basically a non-tariff barrier,” he contended.

But local authorities are not yet prepared to run the risk implied in suspending use of the vaccine simply to satisfy potential buyers.

The important thing, producers maintain, is to demonstrate that there have been no outbreaks. “There are major flows of trade that show that there is no risk,” said De las Carreras. “Since 1968, Argentina has been selling refrigerated – uncooked – beef to Great Britain, and there was never an outbreak of hoof-and-mouth disease in that country.”

The World Trade Organisation accepts that criteria in certifying the quality of a product. “For that reason, continuing to demand that the country must be able to do without the vaccine is basically a non-tariff barrier,” he contended.

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