MercoPress. South Atlantic News Agency

Argentine beef exporting consortium gives in to gov't demands

The Consorcio ABC suspected foul play from other exporters but changed its mind nonetheless

A leading beef-exporting group in Argentina, which earlier this week had stood up to the Government's demands that the domestic market should be prioritized over shipments abroad, has given in to the authorities' warning and agreed to supply their share of cuts at “Cared-for Prices.”

The group, which accounts for 82% of beef sales abroad, had unilaterally decided to stop selling popular cuts at affordable prices for domestic consumption due to alleged “differences” with the Government's export policy.

The Consorcio ABC finally decided it will carry on with the “Cared-for Cuts” program, thus invalidating their previous announcement.

It was Agriculture and Livestock Julián Domínguez, who, in a very tense and “not at all friendly” meeting, had informed them that those who disregarded the domestic market would be banned from exporting.

Read also: Those who disregard Argentina's market will be banned from exporting beef

The consortium will therefore need to supply its monthly share of tons of the so-called popular cuts at affordable prices, as per the January agreement.

ABC's stance was not supported by the other meat processing chambers, and after the Minister's harsh warning they decided to change their minds.

Domínguez explained that “I made this decision in the context of the war conflict that has caused global increases in food prices, a situation that adds to the crisis that our livestock is going through due to the drought, the fires in Corrientes and the shortage of 1.5 million head of cattle”.

The Consorcio ABC, which gathers the largest exporting meatpacking plants in the country, had unilaterally decided to abandon the “Cared-for Cuts” program Tuesday.

Since the end of last year, the different industrial chambers and agricultural entities of the sector had agreed with the Ministry the partial reopening of exports, enabling foreign sales of beef from D and E categories, while sparing for the domestic market the more affordable cuts and also those preferred by local consumers.

Also in January, meat-packers agreed on a price for domestic sales which was at that time, between 20 and 30% below the average market price. These figures would be effective from January 7 to April 7, after which they were to be reviewed. A commitment was also reached for the whole year to supply 6,000 tons per month of these cuts for domestic consumption.

This week, the Consorcio ABC decided to abandon the program, due to alleged discrepancies with the official policy. They claimed that companies without their own slaughterhouses and with meats of dubious origin were authorized to export. It was also argued that these other exporters did not settle their income through the official exchange channels and then took advantage of the different foreign currency rates as well. The consortium also said they suspected that, under the apparent export of discarded beef, they were exporting those cuts they were forbidden to sell abroad.