MercoPress. South Atlantic News Agency

Argentina: Beef exports fall as livestock prices rise

The rise in livestock prices during the last year resulted in a drop in beef exports, which in the first quarter of 2005 posted a 5 percent decrease from 2004, according to the ABC Beef Exporters Chamber.

Meanwhile, the group of the country's exporting meatpackers said that a drop in prices in recent days in the Liniers market facilitates the compliance with the agreement signed with the Agriculture Secretariat to lower domestic market prices, and urged for these falling prices to be transferred to consumers.

"In the first quarter of 2005, beef sales abroad fell by 5 percent, from 267 million dollars in October-December 2004 to 254 million dollars in the January-March period 2005," ABC sources said.

The entity said that the downturn in exports is due to the rise in livestock prices, which reached "10 percent in the last 12 months."

ABC said that although the National Foods Service (Senasa) announced that beef exports had risen 40 percent last quarter, it did so by comparing this period with the first quarter of 2004, when most international markets were closed to Argentine beef due to foot-and-mouth disease.

ABC sources added that the growth highlighted by the official sanitary agency "continued until last November, but then stagnated and today shows signs of significant contraction."

The ABC consortium stressed that "the phenomenon is explained by the strong price increase in livestock, which rose from 0.63 cents of a dollar per kilo in the first quarter of 2004, to 0.70 cents in the first quarter of 2005, which represents a 10 percent increase in the cost of exporting meatpackers' raw materials."

Another related factor in the falling level of beef exports is the "strong competition from Brazil" currently "the main beef exporter in the world" which makes it difficult for local meatpackers to justify livestock prices and, according to ABC, explains why "a business that began with great expectations in 2004, is now beginning to seriously worry exporters."

ABC sources added that "the lower prices registered in recent days" in livestock prices in the Liniers market, coupled with the sector's difficulties, contributed to "positively" reducing the price of beef, which they hope will reach "points of sale, and be transferred quickly to the consumer."