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ECONOMY | 17-06-2021 10:19

Beef exports: Government, meatpackers close in on agreement to lift ban

Productive Development Ministry hints that deal to reopen exports could be announced soon, in conjunction with cattle-breeding plan to boost production

The government and meat producers are close to an agreement that would lead up a lifting of a ban on beef exports, according to reports.

"Only details are lacking" for the return of beef exports following advances during this week, government sources told the Noticias Argentinas news agency. 

Argentina, the world’s fourth-biggest beef exporter with 819,000 tons sold last year, announced a 30-day suspension on overseas sales on May 20 "as a consequence of the sustained rise in beef prices on the domestic market." In response, cattle-breeders decided to halt all marketing of livestock for nine days.

Both sides are now hoping to reach an agreement that would prevent the existing ban being extended.

The government, however, is sending out mixed messages. On Tuesday Cabinet Chief Santiago Cafiero downplayed the changes of a deal, despite Productive Development Minister Matías Kulfas anticipating an "imminent" conclusion to negotiations.

"The proposals which they have brought to the table are still not acceptable. We are hoping to close these negotiations in order to be able to resolve this issue," said Cafiero.

Kulfas had declared that "an agreement is being reached with the beef sector whereby the aim is to guarantee that the tables of Argentines are supplied and that the export business may continue."

The minister told the C5N television channel: "We want to progress to a cattle-breeding plan taking us to an annual production of five million tons of beef, since China is an opportunity. But we must meet it in an orderly fashion without neglecting the domestic market." 

Current beef production is over three million tons.
Regarding an initial agreement, the government is floating the possibility of "giving priority" to between five and nine traditional consumer cuts remaining in the domestic market at accessible prices, within a determined quota of around 12,000 tons. 

Government sources admit that is a low percentage of total family consumption.
 

Eye on China, Israel

According to reports, these ‘national cuts’ would remain outside the list of possible exports, though other key markets would be prioritised. 

In recent days – following talks between Kulfas and members of the Consorcio de Exportadores de Carnes Argentinas – news leaked in the press that the government could authorise, in principle, the selling of some beef cuts for China and Israel.

China currently represents almost 80 percent of beef exports, while last year Israel imported 27,310 tons from Argentina – 15.1 percent more than in 2019. The sales value rose 17.5 percent to US$189.8 million.

Israel’s Ambassador to Argentina Galit Ronen warned recently that lack of supplies could force the Middle Eastern nation to look elsewhere.

“Israel cannot go without beef any time Argentina feels like it. If Argentina is not going to sell us beef on a regular basis, we’ll look elsewhere,” said Ronen.

Kulfas said this week that the government had already spoken to the diplomat to explain that the export ban “is temporary.”
Other reports this week suggest that a proposal to allow half of the normal volume between June and July to be exported is being studied.

Nevertheless, the farming sector suspects that exports will not be reopened totally with their uncertainty advancing over a possible return to a quota system accompanied by increased export duties.

 

– TIMES/PERFIL/NA

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