Argentina's shrinking beef supplies the talk of WMC
September 29, 2010
by Meat&Poultry Staff
BUENOS AIRES, ARGENTINA – Although the focus of World Meat Congress 2010 is global, this year's venue is zeroing in on Argentina's shrinking beef supplies – which are the result of severe drought and interventionist government policies that have hampered its beef industry's ability to export. Erin Daley, US Meat Export Federation Economist, said this has emerged as one of the meeting's dominant topics.
"These circumstances are making grain farming much more attractive than ranching, contributing to a shift in this region's land use," Daley said. While the Argentine government's intent in limiting exports was to keep domestic beef supplies plentiful and prices low, the result has been quite the opposite as producers have shifted resources, beef supplies have tightened and domestic beef consumption has declined sharply, she added.
"Argentina's policy of trying to maintain low domestic prices, because beef is such a staple in that country, has seriously backfired," Daley added. "The constraints on exports have made it impossible for beef producers to be profitable because they are essentially under a price cap, and they cannot capitalize on improving global beef prices. This makes it that much more tempting to move land and resources in a different direction, such as planting soybeans. Combine these circumstances with a severe drought that was already causing a reduction in the herd, and you have a very tough environment for cattle producers."
Although local issues have made a strong impression on conference attendees, the main focus of World Meat Congress 2010 is sustainability. Daley said the meeting attracted an impressive collection of experts to address challenges faced by beef and pork producers throughout the globe.
"It's interesting to hear the concerns about environmental issues and the limitations the industry faces with regard to availability of land and other resources," she said. "Going forward, there are many serious challenges with regard to maintaining and growing world meat production, and this conference allows us to hear a variety of interesting perspectives."
Joel Haggard, USMEF senior vice president, spoke on challenges and opportunities facing the US pork and beef industries. Philip Seng, USMEF president and CEO, will moderate the meeting's closing roundtable discussion on Wednesday, which focuses on the long-term future of the global meat industry.