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ECONOMY | 31-01-2020 15:53

Argentina seeks to expand beef-price caps as consumption sinks

The government aims to expand the types of beef cuts that will be price-controlled in an effort to keep the product affordable amid rampant inflation.

Argentina’s Production Ministry is looking to add more cuts of beef to a price-control system in a bid to make red meat more affordable amid rampant inflation, according to a ministerial official.

Government and industry representatives are in talks over possible additions to the Precios Cuidados price-controls scheme, the official said, adding that no decisions have been made.

Under current controls, prices are capped for four types of cuts at supermarkets, allowing butchers to compensate by charging more for other cuts, which in turn allows ranchers to receive full market prices. An expansion of the program could disrupt that.

Years of recession and high inflation combined with booming exports and shifting food trends have sent red-meat consumption to the lowest in a century in Argentina. Last year, per person consumption fell to 51 kilogrammes (112 pounds), the lowest level since 1920, according to Argentina’s chamber of commerce and industry for meat and its derivatives, CICCRA.

But in Argentina, traditionally one of the biggest ranching nations, beef is a still considered a staple, turning the price surge into a political issue for the governing Peronist party. Inflation in the country reached 54 percent last year, the highest in almost 30 years.

—BLOOMBERG

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