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ECONOMY | 22-05-2021 09:23

Cattle farmers strike against government’s ban on beef exports

President Alberto Fernández defends decision to block beef exports for 30 days due to rising prices; Angry pushback from industry groups.

Cattle farmers on Thursday started a nine-day halt on cow sales to abattoirs to protest the government-imposed pause in exports designed to moderate skyrocketing domestic meat prices.

The usually-bustling Hacienda de Liniers cattle market in Buenos Aires was desolate on the first morning of the strike, its pens empty and with just a few administrative employees around. The following day, the scene was much the same.

The strike is not expected to lead to domestic shortages in the short term, as abattoirs and butcher shops had stocked up in anticipation.

Negotiations between the industry and government are under way. The government has hinted it may trim the ban, should agreements over prices be reached.

"We will continue to dialogue to find a way out to supply the domestic market and, at the same time, boost exports. They need to be compatible goals," Internal Trade Secretary Paula Español said on Thursday.

On Monday, the government of President Alberto Fernández announced a one-month suspension on foreign meat sales to "get the sector in order, restrict speculative practices and avoid tax evasion in foreign trade."

 

‘Out of hand’

"The meat issue got out of hand. The prices rise month by month without justification. We have to put it in order," the president told Radio 10 in an interview. "We cannot see how the prices grow without any justification, or that the price of meat prices and consumption drops.”

Poverty affects 42 percent of Argentines, and the Frente de Todos leader is trying to reduce the cost of living by implementing price controls ahead of crucial midterm elections later this year.

Fernández insisted Argentina could not accept the recent rise in meat prices in a country already reeling from three years of recession and the adverse economic impact of the coronavirus pandemic.

"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."

The price rises contributed to Argentine inflation, already among the highest in the world, reaching 17.6 percent in the first quarter of 2021, according to the INDEC national statistics institute.

The cost of living soared 46.3 percent in the last 12 months, and beef prices in April were 65.3 percent higher than a year earlier, according to the Argentine Institute of Beef Promotion (IPCVA).

 

Producers strike

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."

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."

In response to the government's move, the La Comisión de Enlace de Entidades Agropecuarias (“Liaison Commission of Agricultural Entities”), which represents agricultural producers and businesses, declared a "cessation of all categories of cattle trade" starting on Thursday and lasting until May 28.

In 2008, the then-called Mesa de Enlace of the countryside organised an agrarian strike lasting almost four months against the project of former president (now Vice-President) Cristina Fernández de Kirchner (2007-2015) to raise taxes on exports. 

The harsh conflict that put the government in check at the time ended when Congress rejected the initiative.

According to the Argentine Chamber of Industry and Commerce, the beef industry employs some 100,000 people.

Argentines 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.

In 2020, the country exported 819 billion tons of beef and cow leather worth US$3.37 billion – a 16.5-percent drop from 2019 – primarily to China, Germany and Israel, according to INDEC.

Agricultural exports make up most foreign spending in the country.

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

"It is not possible that Argentines end up paying a stellar price for meat just because the idea of ​​sending meat abroad predominates," he said Wednesday.

– TIMES/AFP

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