Argentine Minister of Productive Development Matías Kulfas Sunday admitted the administration of President Alberto Fernández plans to both ban exports of the beef cuts most coveted by local consumers and freeze domestic prices until late this year.
Kulfas addressed these subjects during a radio interview but the official announcement is expected to be made by Fernández himself at the Casa Rosada on Tuesday after Monday's national holiday.
The minister spoke of a comprehensive livestock plan in which, in addition to resuming exports, greater availability of cuts at low prices in the domestic market will be sought “to guarantee affordable prices for the cuts most consumed by Argentines.
The idea, said the Minister, is that we can keep some of the products that have been directed to the foreign market in the domestic market to increase supply. But he refrained from being more specific as the details of the program were still being finalized.
According to local press reports, the Government is looking for a basket of a dozen cuts of beef at affordable prices and negotiated with the meatpacking companies to keep the values of these products frozen at least until November and at the same time supply not only the supermarket chains but also butchers where prices skyrocketed in recent months.
This is not a specific measure, but rather a comprehensive policy that allows Argentina to get out of the stagnation it has had for many decades, said Kulfas, and then added that while the Argentine population has been growing, its production levels of meats have stagnated.”
Kulfas warned that if we want to continue eating beef, which is a highly valued commodity in this country, and also to increase exports, which is a desirable objective, we have to increase production, otherwise this will not be possible.
Regarding the new exports scheme, there will be a controlled opening with a cap which shall not exceed 50% of what was shipped abroad last year.
There will also be destination-based restrictions: To China, only bone-in cuts may be exported, while the authorization for premium products to reach Europe and the US will be maintained. A quota of kosher cuts to Israel will be reinstated.
In addition, Kulfas said exports were to resume next week, but “it will be done with a much more controlled scheme because we face not one or two, but many manoeuvres of tax evasion and circumvention of the customs regulations customs and [currency] exchange.”
Regarding the livestock plan, Kulfas insisted on the need for tax and credit incentives for Argentina to abandon decades of meat production at around 3 million tons and move on to exceed 5 million tons, which, he considered, will allow a better coexistence between the domestic market and exports.
Meat producers on the other side said they had no knowledge of Tuesday's announcements and that they had not been a part in any negotiation whatsoever leading to the president's decisions. They said the measures known so far were “insufficient.”