Last year Argentina exported less beef onto the global market than in 2014 but, despite this, trade to China still soared.
Argentine beef exports are closely monitored by the government which provides export permits for each shipment. In 2014 Chile was the number one market for Argentine beef, in volume terms, followed by Russia and the EU. All three markets showed some economic problems last year, including currency devaluations, which meant that beef exports shifted towards China. Consequently, China became the largest importer of Argentine beef last year as shipments almost doubled on the year earlier. Chile remained the second destination for Argentine beef, although shipments were lower on the year. In addition, having capitalised on shortages in the second half of 2014, shipments to Russia were notably lower in 2015.
The EU remains the most important market for Argentina in value terms. Most beef exported to the EU is under the High Quality Beef Quota (Hilton Quota) which covers chilled and frozen higher valued cuts at reduced import duty. For several years Argentina has not been filling this quota. In 2014/15 year ended June, certificates for 22,867 tonnes were issued, so there is scope for an increase in shipments under this quota in future. Argentina is also now supplying grain-fed beef under the autonomous HQB scheme. This is set at 48,200 tonnes per annum and covers a number of countries with the United States and Australia the main suppliers at present. The UK takes negligible quantities of beef from Argentina, with most product consigned to Germany and the Netherlands accounting for 85 per cent of Argentine trade with the EU. As a result, for the UK, while there is no direct effect on the domestic market Argentine beef can impact on its prime beef export trade with Germany and the Netherlands for example.
Looking ahead, Argentina may well be heading towards export levels more in line with its past export performance. The elimination of curbs on exports of agricultural products in Argentina, including beef, and the liberation of the nation’s currency is believed to be going to provide a boost to the rekindling beef exports. Today, beef exports account for seven per cent of total beef production, while from 1995 to 2005 they averaged 15 per cent. However, it will take the livestock industry some time to recover, the country’s cattle herd has contracted by almost 7 million head in the last decade. The most rapid way of increasing beef exports would be as a result of significantly lower domestic consumption. While Argentine consumers have become less dependent upon beef in recent years, it still remains the favoured meat, by some considerable margin. It has one of the highest per capita consumption rates in the world.