MercoPress. South Atlantic News Agency

Russian meats market paralyzed; Uruguay and Brazil exports affected

Prepared cattle in Uruguay is not enough to meet demand

The Russian market which has been the main buyer of Uruguayan beef helping to boost cattle prices has virtually ceased operations according to Uruguayan exporters who claim deals are limited to small shipments of livers and tongues.

This follows a recent decision, June 15, from Russian sanitary authorities banning all meat imports from the majority of Brazilian abattoirs in three states which could be made extensive to other states unless Brazilian authorities strictly comply with requirements for meat access to Russia.

Uruguayan exports believe the Russian decision was taken following a glut of imports, mainly from Brazil, which has depressed local market prices ahead of the northern hemisphere spring and summer supply of cattle.

“Russia it totally paralyzed and everybody is pushing prices down”, said Samy Ragi from Mirasco International Food Merchants operating from Montevideo.

This contraction of the market is showing in the tonnage of Uruguayan beef exports that according to the latest figures has dropped 11% in the first five months of the year compared to the same period in 2010 and in the first two weeks of June has fallen further to 14%.

“Brazilians glutted the Russian market with different meats and until stocks don’t begin to drop, the market is dead. I guess the situation could last from two to three months”, added Ragi.

However Uruguay has diversified markets and has other options but it is also true that the country has insufficient prepared cattle to meet demand. This has been caused by the advance of agriculture and the fact that consecutive drought periods influenced pregnancy and calving is down.

Nevertheless Uruguay export numbers show that beef sales to the European Union have fallen 23% and to the US, 8% with similar percentages to other destinations. This can also be explained because Uruguayan beef is expensive, averaging 3.927 US dollars a ton so far this year, which is 38.5% higher than in 2010.

But Uruguayan officials are not very concerned arguing that the international beef market is undergoing a period of adjustment, “which is only natural”.

“There is no need to be alarmed: world supply of beef is not enough to meet demand, and the current slowdown is not because of the Uruguayan beef”, said Fernando Pereza Abella, Vice president of the National Meats Institute, INAC.

Meanwhile from Moscow Serguei Dankvert head of Agriculture Sanitary Inspection reiterated that Brazil in the shortest time possible must guarantee an effective quality control for meats shipped to Russia.

Earlier in the month Russia banned imports from 89 abattoirs in the Brazilian states of Matto Grosso, Rio Grande dos Sul and Parana.

Apparently taking advantage of the current G20 Agriculture ministers’ summit in Paris officials from Russia and Brazil would be meeting to address the issue.