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Argentina beef exports begin to pick up and could reach US$ 1bn this year

Friday, December 30th 2016 - 17:27 UTC
Full article 20 comments

Argentina's beef exports totaled 193,000 tons between January and October, up 10% from the same period last year, the government said, a year after it rescinded export taxes and restrictions. Read full article

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  • Marti Llazo

    Increased Argentine beef exports and growth in revenues, with associated beneficial impacts on domestic employment and higher contributions to both provincial and national treasuries, are certainly going to make reekie very, very angry. After all, Kirchnerism did all it could to destroy the beef-exporting industry.

    Dec 30th, 2016 - 05:39 pm - Link - Report abuse +3
  • DemonTree

    Finally some good news. Placing export restrictions on one of your main exports seems pretty daft.

    Dec 30th, 2016 - 06:45 pm - Link - Report abuse +2
  • ElaineB

    @ DT

    One of my dear friends in Argentina owns an abattoir and under the K's life was tough. She couldn't sell the meat to anyone at any price but would have to wait for a phone call from the government telling her who she could sell to and at what price. As she put it, whoever had paid the bribe to the government official.

    Dec 30th, 2016 - 07:36 pm - Link - Report abuse +2
  • DemonTree

    @ ElaineB
    Wow, that's a seriously messed up way to run a country. Who in the 21st century could have thought that was a good idea?

    Dec 30th, 2016 - 09:29 pm - Link - Report abuse +2
  • Marti Llazo

    Kirchnerism took a heavy toll on the beef industry in Argentina. Between 2003 (Néstor) and 2012 (CFK) the number of mataderos (meat packing plants) dedicated to beef fell from 419 to 362 -- that's 57 fewer plants in that many years.

    There were about 57 million head of beef in 2007, when the peronistas implemented export restrictions and price controls. This resulted in a reduction to about 48 million head of cattle by 2011 because, well, CFK's peronism apparently hated the producers and didn't understand fundamental economics.

    In 2004 and 2005 Argentina was the world's third largest beef exporter. Today Argentina has fallen to somewhere between 11th and 14th place, depending on whose numbers you want to use.

    Dec 30th, 2016 - 09:48 pm - Link - Report abuse +2
  • imoyaro

    Even Paraguay has been exporting more beef than Argentina, a return to the days of El Supremo.

    Dec 31st, 2016 - 01:57 am - Link - Report abuse +2
  • Kanye

    Elaine and ML

    Doubtless Mr. Enrique will tell us it was either the fault of Menem and his “neo-liberals”, before Evita K and Nestor,

    or

    They had to develop the beef restrictions in order to prevent the “elites” from shamelessly profiting from the labours of their employees.

    Dec 31st, 2016 - 08:43 am - Link - Report abuse 0
  • Enrique Massot

    The Kirchner governments tactically restricted meat exports to keep domestic prices accessible.
    Macri, of course, does not give a rat's arse on whether meat domestic prices spiral--as long as estancieros and packers are happy.
    It does not make me happy that my predictions from one year ago are confirmed.
    By the same token, the success in meat exports does not make me at all “very, very angry,” as Marti puts it. Wouldn't it be good if these increased exports reversed the negative trends reported in another MP story?
    Fact is, una golondrina no hace verano (a swallow does not make a summer) and unfortunately, increased exports can't compensate for the losses in domestic economic sectors.

    Dec 31st, 2016 - 11:15 pm - Link - Report abuse -4
  • Marti Llazo

    @ reekie ...... “tactically restricted” .....means that CFK ripped the heart and lungs out of yet another competitive and profitable industry. And would do so again if given the chance.

    As noted earlier, CFK's actions had the effect of causing enormous damage to the formerly world-famous beef industry in Argentina, ultimately resulting in higher prices for domestic consumers, limiting supply, and causing a great deal of unemployment and financial losses in that sector. A lose-lose proposition. It may take a long time to recover.

    This is because neither Reekie nor CFK have any idea how competitive economic systems work.

    We would do well to remember that beef exports are what put Argentina on the map, that British markets and railroads and refrigeration technology made a somewhat modern and one-time wealthy Argentina possible. An industry only to be shuttered by Kirchnerism.

    In the meantime, we actually get better steaks now when visiting Chile during our monthly shopping trips, and at much better prices. In fact I'll even let you know where in Punta Arenas: at Los Ganaderos, near the Costanera; or Sabores, on Mejicana.

    That “tactically restricted meat exports” is why Kirchnerism's economy-damaging policies resulted in tiny New Zealand exporting more beef than Argentina. And why Brazil exports more beef than Argentina. And why Mexico exports more beef than Argentina. And why the US exports more beef than Argentina. And India, and Australia, and Belarus, and the EU, and Canada, and Uruguay and little Paraguay.... all export more beef than Argentina, and their economies are the better for it.

    Jan 01st, 2017 - 12:40 am - Link - Report abuse +2
  • DemonTree

    @EM
    You really think cheap beef at home is more important than a functioning economy? Never mind the fact that such restrictions just don't work. Are there any Kirchnerist policies you don't support?

    Jan 01st, 2017 - 12:33 pm - Link - Report abuse +3
  • Marti Llazo

    An example of how wonderfully the CFK policies surrounding domestic beef prices and the economy in general:

    Take the case of the price increases for matambre, a local sort of rolled stuffed flank steak. Using the price survey data from the Argentine beef-promotion agency, for the greater Bs As area, we see the average price per kilo going from 45.4 ARS in February of 2013 to an average of about 68.4 ARS just a year later. That's more than a 50% increase in price in a year and considerably more than “mere” inflation that the government was trying to claim was less than 25% annually but in reality was more than 40 %. During these CFK times there were many popular cuts of beef that were increasing in average consumer cost by about 18 percent per MONTH. When Kirchnerismo imposed the “precios cuidados” and artificial price controls for certain cuts of meat, those controlled items ended up being some of poorest quality pieces of meat you've ever seen, riddled with tendons and gristle and with a lot of the weight taken up by butchers leaving extra fat on the cut.

    Reekie would not know anything about this because he's 12,000 miles away, enjoying cheaper and much nicer quality Canadian beef, and has probably not even purchased meat from an Argentina híper in the past 20 years.

    Jan 01st, 2017 - 03:46 pm - Link - Report abuse +2
  • ElaineB

    @ ML It is certainly true that the Argentines do not get the best meat. That has always been for export. You can hear them complain about it all the time. You are also correct that it was the raging inflation that caused the meat to become so expensive. Obviously not for the K's buddies. They were able to buy the best at the cheapest cost and the producers were forced to sell to them at a loss.

    Everything was corrupted under the K's. It was one of the realisations that eventually turned people against CFK.

    Jan 01st, 2017 - 04:44 pm - Link - Report abuse +2
  • Marti Llazo

    @EB “It is certainly true that the Argentines do not get the best meat. That has always been for export.”

    - A similar situation with olive oil when I lived in Catalunya, during the Franco years. We couldn't get the better grades of olive oil within the country. The good stuff was for export. There is a certain coincidence that just as I now make a monthly shopping trip to Punta Arenas for certain food items, back then we would do a one-day round-trip bus ride to Andorra and there we could get the best olive oil and certain other items we could not get on the Spanish side. It was about 3 hours each way on that bus so I remember it all made for a long day. But good olive oil is worth a bit of sacrifice.

    BTW, there are many places in the rural south where really good Argentine beef was and is available, since there was no interest in exporting it from that area, evidently. There was a tiny place in Gobernador Costa in Chubut (of all places) that served the most excellent beef. Likewise some great steaks always or almost always to be had in Esquel, Perito Moreno, and El Calafate during the past 20 years or so.

    Jan 01st, 2017 - 09:01 pm - Link - Report abuse +2
  • Enrique Massot

    @DT
    It's all a matter of balance. Argentina, contrary to what ML would assert, has remained a significant meat exporter, however I do remember times when meat at home was horrendously expensive because priority was exporting.
    Placing too many eggs in a single basket leaves a country vulnerable to commodity price up and downs it can't control.
    Argentina's domestic consumption accounts for 80 per cent of the GDP, something the current government has apparently neglected to consider in its quest to benefit exporters.
    “Are there any Kirchnerist policies you don't support?”
    Of course! For example, I believe the Kirchners did not put enough emphasis on caring for the environment, and so doing they let mining companies run wild.
    Much of the current disastrous floods originate in greed and a lack of planning on for examle infilling of wetlands and floodplains that curtails the capacity of rivers and wetlands to absorb excess water and much more.
    However, governments have a general direction that can be expressed in who gets what from the national product.
    A government can strive for 50-50 share between workers and employers. If a government points to a 30 per cent for workers and 80 per cent for employers, that government may have a problem.

    Jan 03rd, 2017 - 06:18 am - Link - Report abuse 0
  • Kanye

    Mr EM

    “Placing too many eggs in a single basket leaves a country vulnerable to commodity price up and downs it can't control”

    You are being ridiculous Enrique.

    When the only thing you have for export are raw commodities, you better look for a market for them, regardless of fluctuations.

    Certainly, Brazil is buying fewer cars and other products assembled in Argentina.

    “A government can strive for 50-50 share between workers and employers. If a government points to a 30 per cent for workers and 80 per cent for employers, that government may have a problem.”

    LOL, only you would suggest that workers should have a share of 110% of a business or product.

    How does a government “point to” how much a business shares with its employees?

    Decreeing and imposing wages and benefits?
    Perhaps you are thinking of the Evita K model of imposing punishing taxes on any profitable exports, to be supposedly “redistributed” to the poor and unemployed?

    Why run a business?

    How about taking the retirement savings of employees who have been contributing to private plans, and “redistributing” those funds as a government pension to those who have not contributed?

    Why work?

    Tell us about specific policies of Macri's government that “points to” ensuring employers have 80% of profits and employees have only “30%”

    Your ideological rhetoric bears no likeness to reality.

    Jan 03rd, 2017 - 10:09 pm - Link - Report abuse 0
  • DemonTree

    @EM
    Hobbling one of your most profitable industries does not seem very balanced to me. If beef is fetching higher prices abroad then it will bring more money into the country, and eventually prices will balance out again. People can always buy other types of meat in the meantime.

    Nestor actually banned exports for 6 months, how can that be a good idea? That sort of arbitrary messing with the rules makes it impossible for anyone involved to plan properly, and your former customers will be forced to find other sources and may not come back.

    I'm glad to know you don't support everything the Kirchners did anyway, since that's a sign of someone who doesn't think for themself.

    I do agree it is a bad idea to put all your eggs in one basket, but I don't see why this has to involve reducing the things that are profitable. America is a rich country and still has significant agricultural exports. The biggest danger is relying on just a few exports, or even only one like Venezuela with oil.

    @Kanye
    I suppose governments control who gets what by choosing what to tax and how much, what kind of regulations to enforce like minimum wages, maternity leave, and maximum hours for workers. Also what kinds of benefits to pay.

    For example, if unearned income is taxed at a lower rate that earned income, you may well conclude that the government is not favouring workers.

    Jan 04th, 2017 - 12:07 am - Link - Report abuse 0
  • Kanye

    DT

    One looks at what the end goals are.

    EM cites an arbitrary government initiative to legislate or tax businesses, dictating profits MUST be shared with workers to ensure they receive their 50%.

    This is in contrast to a government that legislates wages and benefits to ensure a “liveable wage”, and accessible and affordable health care.

    Jan 04th, 2017 - 04:34 am - Link - Report abuse 0
  • DemonTree

    @Kanye
    I wonder if any government has tried passing a law that some percentage of a company's profits must be paid to the employees as a bonus? I suppose employers would find ways around it, but it would be interesting to see the results.

    Jan 04th, 2017 - 07:38 pm - Link - Report abuse 0
  • Kanye

    DT

    I believe that expected at Christmas time in Argentina - employees get a bonus equivalent to an extra month of wages.

    And those on the dole, too.

    I don't know if it's legislated or not.

    Perhaps someone here has more information.

    Jan 05th, 2017 - 02:24 am - Link - Report abuse 0
  • Marti Llazo

    No simple answer to who gets how much for the year-end bonos but if you look at the graphic on this site you get an idea of the wide range of those bonuses for some categories of workers.

    http://www.clarin.com/ieco/bono-fin-ano-cobra-gremio_0_SkN3e6cVx.html

    Note how one union, the Aceiteros (workers in production of vegetable oils) will get so much more than other workers. They may be getting some comeuppance, though, because their once-largest international customer, has nearly stopped buying Argentine vegetable oils because they determined that the prices charged were excessive, and that customer developed their own capacity for turning soy beans into oil.

    So the bean-oil workers get the equivalent of about US$1430 for their bonus and the Bs As police get ..... US$160

    Jan 05th, 2017 - 03:36 am - Link - Report abuse +1

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