MercoPress. South Atlantic News Agency

Argentine meat packers move to ensure supply with feedlots

Quickfood one of Argentina’s main abattoirs is considering setting up two huge feedlots to fatten cattle, each with 22.000 steers, making it one of the leading companies in the industry

The two farms would be located in the provinces of Buenos Aires and Cordoba, demanding an investment in the range of 8 to 10 million US dollars. Argentine feedlots ready annually 6.5 million head of cattle, equivalent to 70% of the country’s supply.

Quickfood which belongs to the Brazilian global beef industry group Marfrig currently fattens 53.000 cattle in its own feedlots and its abattoirs process 300.000 head of cattle annually in Argentina.

The idea behind the project is to ensure a steady supply of cattle for its industry, both the domestic market and exports. Last year Quickfood exported an average 2.000 tons of beef monthly totalling sales of 125 million US dollars.

“These kinds of investments are long term. Argentina for too long now has a tendency to leave aside beef production but there’s great potential”, said Miguel Gorelik, a company manager.

The investment is also motivated hoping for the re-opening of the US market to Argentine beef. However the main reason for investment in feedlots is to ensure a steady supply to abattoirs given the contraction of the Argentine cattle herd.

Current taxing policies and the boom in cereals and oilseeds have altered the rational economics of Argentine farming with much grazing land and dairy farms ploughed for agriculture.

Other competitors such as Swift, which now belongs to another Brazilian beef giant JBS has also joined the feedlots business as has Tyson Foods from the US.