DEVELOPMENT: Cattle Disease Hits Brazil’s Export Hopes

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, May 17 1999 (IPS) - Brazil, desperately attempting to combat an outbreak of hoof-and-mouth disease among cattle, has taken the drastic measure of isolating the country’s largest herd.

The disease must be eradicated for Brazil to compete in the international beef market.

The hoof-and-mouth outbreak first occurred in the town of Navirai in the state of Mato Groso do Sul – home to more than 20 million head of cattle. At least 1,500 animals have been slaughtered this year to prevent the disease spreading but the Ministry of Agriculture banned beef from the state appearing in the markets of central west Brazil.

This was a virtual “death sentence” for the cattle producers who supply the state of Sao Paulo, Brazil’s largest market, said Pedro Camargo Neto, leading cattle rancher and president of a development fund for the sector.

Brazil has the largest cattle herd in the world, with a total of more than 160 million head – the equivalent of one for every inhabitant. But productivity is low because they are range cattle, living on the natural pastures of large ranches without much attention to nutrition and medicine.

However, cattle raising being transformed in an attempt to better compete and increase exports to markets abroad.

Last year, boosted by Argentina’s rising meat prices, Brazil was able to export beef worth 572 million – 33 percent more than the value of exports in 1997.

The cattle consulting company “FNP” predicts there will be a 40 percent increase in exports this year, pushed by the devaluation of the Brazilian real in January and the fall in Brazil’s beef consumption due to the economic recession.

FNP analysts forecast an even better performance in the year 2000, resulting from the United States’ decision to cut their own agricultural export subsidies, creating opportunities for more competitive producers.

The Getulio Vargas Foundation, a Brazilian economic research centre, estimates that world meat consumption will grow by 29 percent between 1997 and 2007, reaching 227 million tonnes. Beef represents just 13 percent of the total, versus 64 percent pork, and 26 percent poultry.

But international beef trade reached 18,300 million dollars in 1997, with Brazilian exports at just 2.35 percent of the total.

If Brazil wants to increase its participation in world beef trade, in addition to adopting technological advances, the major cattle producers must eradicate hoof-and-mouth disease. The larger consumer markets will not accept beef from areas or countries where there are outbreaks of the disease, despite the fact that it does not affect human health.

The two southern Brazilian states of Rio Grande do Sul and Santa Catarina have been certified as disease-free by the International Epizootic Organisation. The neighbouring countries of Argentina and Uruguay also have been certified as free of hoof- and-mouth disease.

This has left the regions with the highest concentration of cattle, the centre-west and southeast, fighting to obtain certification for next year. Three years have passed since the last case of hoof-and-mouth disease was reported in those areas.

The hoof-and-mouth outbreak in Mato Groso do Sul threaten to undo the large vaccination efforts, as well as the control and occasional slaughter of animals suspected of carrying the disease. It was a difficult decision to isolate the state’s cattle because 90 million animals were involved.

For 24 months, beginning July 1, the state’s borders will be closed to the entrance or exit of live animals that have not been quarantined or passed a veterinary examination. The restrictions also apply to beef that contains bones.

Only processed meat will be allowed to leave Mato Groso do Sul, representing just 10 percent of the state’s meat production.

The positive side of the restrictive measures is that it will stimulate local industry, reducing idle time at meat packing plants, and creating work, said Jose Roldao, representative of the Ministry of Agriculture.

However, Camargo Neto and Antonio Russo Neto, president of the Brazilian Beef Exporting Industry Association, said that the disadvantages outweigh any advantages because the state’s cattle will lose their market and prices will fall if there is a surplus.

Russo added that the measure will affect the entire national market. Sao Paulo, Brazil’s largest consumer centre, normally buys 20 percent of its beef from Mato Groso do Sul and cattle ranchers have stepped up their beef sales in Sao Paulo before the ban is implemented.

Market experts estimate that 1.5 million animals will cross the state border before July 1, doubling the annual flow between the two states.

This situation makes it difficult to control the vaccinations of so many animals in such a short time, increasing the risk of infecting cattle in Sao Paulo, which is just what the restrictive measures were intended to prevent.