ARGENTINA’S run on the global beef market has stepped up a significant notch with the doors now once again opened for raw beef to be shipped to the United States.
The trade has been closed for close to 20 years following an outbreak of foot and mouth disease but it appears the Argentine vaccine program has lessened those concerns.
The US Department of Agriculture issued a statement saying although Argentina had been eligible to export cooked and ready-to-eat processed beef products to the US, it has not been eligible to export raw beef products.
Upon completion of an audit of Argentina’s inspection system for beef slaughter and further processing, the Department had determined Argentina as eligible to export raw beef to the US from cattle slaughtered on and after November 27.
US analyst Len Steiner, speaking at an Australian beef industry event in Brisbane this week, said it would take time to have all the plants inspected “but certainly Argentina is coming.”
China ramped up its beef purchases from Argentina this year, which has pushed Argentina into the world’s top ten exporters.
“Political powers in Argentina had a theory for the last 15 years that if they keep all the meat at home it will depress prices and the people will be happy,” Mr Steiner said.
“That decimated the packing houses and ranchers and so things have changed.”
Argentinian beef production growth was levelling off now but Brazil’s continues to increase, US intel says.
“Brazil is not allowed to ship into US at this time. Maybe things will change after the US election but at this point the indication is the USDA will audit Brazil again before making any decision,” Mr Steiner said.
With resurgent Chinese demand, Brazil had expanded exports rapidly despite its lack of access to the US market, he said.
Brazil had also just been authorised to ship into Russia again.
Meanwhile, it is China and Hong Kong that are grabbing the big share of the world’s beef.
They have a 45pc share of Brazil’s supply, 53pc of Argentina’s, 53pc of Uruguay’s, 24pc of New Zealand’s and 14pc of Australia’s, Mr Steiner’s data showed.
African swine fever
African swine fever is a big deal, according to Len Steiner.
“It’s not dangerous to people but it may upset people - they won’t want to eat a pork chop from a hog that has it,” he said.
“There is no vaccine, no cure, it’s easily transmitted and the virus lasts a long time in extreme environments.”
Steiner’s data shows China consumed an incredible 12.8b pounds of pork in 2017. The European Union came in second at 45.9b pounds and the US third at 21b pounds.
“If you look at the diets for meat, you see how important pork is in China - it accounts for 61pc while beef is 6pc,” Mr Steiner said.
While China is importing pork from Europe and Germany, and they will probably come to the US as the shortage sets in, they won’t be able to turn things on dime even with aggressive buying that outbids everyone else in the market, he believes.
“We think the first thing they’ll go to after pork is poultry and maybe they can raise enough to supplement themselves but probably not.”
So their next step will be beef.