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ECONOMY | 19-06-2021 09:36

Kulfas says suspension on beef exports could be lifted next week

Productive Development Ministry hints deal with meatpackers that would allow re-opening 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 to a lifting of Argentina’s ban on beef exports next week, according to Productive Development Minister Matías Kulfas.

In an interview with El Destape Radio on Thursday, the minister confirmed that both sides were finalising “a new scheme of rules” that would see a greater volume of meat guaranteed for domestic consumers. If an agreement is reached, “the path to exports could be resumed next week,” he added.

“We want everyone to know that popular cuts are at affordable prices," stressed Kulfas.

The news comes just a day after government sources told the Noticias Argentinas news agency that “only details are lacking.”

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.

Industry representatives, however, expressed reservations on Thursday, with CARBAP leader Horacio Salaverri warning another "cessation of commercialisation" remained on the table if the government did not listen to producers.

Some government officials also warned that reports of a deal were premature. "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 Cabinet Chief Santiago Cafiero.



Kulfas said earlier in the week that while any agreement would have to benefit local consumers, opportunities for exporters should not be ignored.

"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," he 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, though Kulfas said the "great objective" is to reach five million tons, with three million guaranteed for local consumers.

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, but it remains concerned by meat prices, which rose 4.4 percent in May, according to official data, despite the suspension.


Eye on China, Israel

According to reports, so-called ‘national cuts’ would remain outside the list of those designated for export, though key markets could be granted exemptions.

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.

The Asian giant 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.



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