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ARGENTINA | 18-05-2021 11:16

Fernández defends 30-day suspension of beef exports

President Alberto Fernández on Tuesday sought to justify his government’s decision to block beef exports for 30 days, in the face of an angry pushback from industry groups.

President Alberto Fernández on Tuesday sought to justify his government’s decision to block beef exports for 30 days, in the face of an angry pushback from industry groups.

"The meat issue has got out of hand. The prices rise month by month without justification. We need to get it under control," the president told Radio 10 in an interview, saying it was necessary to "impose order on those who export."

"We cannot see how the prices grow without any justification, or that the price of meat prices and consumption drops," he argued.

Argentina, one of the world's biggest beef exporters, announced Monday it would suspend foreign sales of the meat for 30 days to combat price increases at home.

Citizens ate 38 kilogrammes (84 pounds) of beef and veal per head in 2019, according to figures from the Organisation for Economic Cooperation and Development (OECD) – about 12 kilogrammes per head more than the second-placed United States.

But they also face one of the most elevated consumer price indexes in the world. Inflation hit 4.1 percent in April, according to the INDEC national statistics bureau, and the cost of living has increased 46.3 percent in the last 12 months. Over the same period, cuts of beef have increased 65.3 percent, according to the IPCVA industry group.

"As a consequence of the sustained increase of the price of beef on the domestic market, the government decided to implement a set of measures aimed at regulating the sector," a statement from the Presidency read. "During the implementation of these measures, beef exports are limited for 30 days."

Exceptions will be allowed for foreign exports already in progress.

 

In an interview Sunday evening, Fernández had trailed the measure, saying he was concerned about the increase in prices, especially of food.

"It worries me a lot, because it is inexplicable, there is really no reason, other than the increase in consumption, to explain the increases that we saw in March and April," he told the C5N news channel.

In 2020, Argentina exported US$3.37 billion worth of beef and cow leather – a 16.5 percent drop compared with 2019 – primarily to China, Germany and Israel, according to INDEC.

Agricultural exports make up most foreign spending in the country.

Fernández said he "celebrates" that Argentina exports beef, but regretted that "Argentines are made to pay the prices they are made to pay for meat."

 

Angry reaction

Beef industry groups pushed back against the plan.

"We are going to join together immediately to totally reject this disastrous measure," said Daniel Peregrina, the president of industry body the Argentina Rural Society. "The damage caused by the measure will decrease the supply of meat, making prices rise as has happened in the past."

On Twitter, the Argentina Rural Confederation also rejected the government's plan.

"The closure of meat exports is an error," the organisation posted. "A step back for the development and growth of ranching. We are on our way to a trading halt."

Recent sustained inflation reinforces the concern that it will be difficult for the government to cap this year's total inflation at 29 percent, which is the target that has been laid out in budget legislation. 

In an effort to fight the effects of a long coronavirus lockdown, the government launched an economic aid programme that included large monetary payouts. 

Argentina is navigating its third year of recession, worsened by the Covid-19 pandemic which led to a 9.9 percent drop in GDP in 2020.

– TIMES/AFP

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