Argentina halts its beef exports

Argentina halts its beef exports

Beef
Argentinian feedlot cattle.

Argentinian feedlot cattle.

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No Argentinian beef to China for 30 days will leave a big gap.

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In a move that will rock the global beef trading scene, Argentina has put a 30-day stop to beef exporting in an attempt to bring down the prices of its domestic beef.

International media is reporting the country's center-left Peronist government unveiled the 'emergency measure' on Monday in a bid to keep a lid on inflation.

Farm sector lobby groups in the South American country are fighting back hard, protesting by refusing to sell livestock at all.

With a herd of close to 54 million head, more than double the size of Australia's, Argentina is one of the largest beef exporters in the world and China has become their main customer.

Argentina competes in the commodity space, and the sheer size of its ability to flood that market, along with Brazil's, is a key reason Australia is moving towards supplying the higher-end market.

SEE: Why Australia should not take on South American beef

Before this week's move, Meat & Livestock Australia analysts were predicting the weak Peso, combined with enduring demand from world markets, should result in Argentinian exports remaining fairly buoyant through 2021. For the year-to-February, Argentinian beef exports were up 23 per cent on 2020, with exports to China recording a 39pc rise on 2020, they said.

With African swine fever continuing to leave an enormous protein shortage in China, the Argentinian ban could send Chinese importers into a spin trying to secure supply. Most analysts seem to believe upward pressure on global beef prices is a given.

China as a buyer was already considered critical to global meat dynamics for the next two decades.

SEE:China's need to feed supersedes political tensions

Argentina's shock decision on beef is in line with wider global concerns about rising food prices. Russia, for example, has imposed a tax on exports of grain.

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