Livestock and Products Semi-Annual 2012

An Expert's View about Agriculture and Animal Husbandry in Argentina

Posted on: 23 Mar 2012

Argentine beef exports for 2012 are expected to decline to 280,000 metric tons, 20,000 tons lower than USDA’s current volume.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Required Report - public distribution Date: 3/2/2012 GAIN Report Number: Argentina Livestock and Products Semi-annual 2012 Approved By: Melinda Sallyeards Prepared By: Ken Joseph Report Highlights: Argentine beef exports for 2012 are expected to decline to 280,000 metric tons, 20,000 tons lower than USDA?s current volume. However, the final volume will be decided by the Argentine government which authorizes export licenses. A severe drought during the service period is expected to somewhat reduce the calf crop. The recovery of the cattle herd continues but at a slow pace. Commodities: Animal Numbers, Cattle Meat, Beef and Veal Production: Argentine beef production for 2012 is forecast to remain unchanged at 2.6 million metric tons (MMT), despite an expected larger slaughter than USDA?s current level. The slaughter is expected to increase as result of a severe drought and very high temperatures suffered during December 2011 and January 2012. Larger than expected number of cows and calves will be slaughtered, being lighter animals they will bring down the average carcass weight. In late January and February the rains returned with a vengeance but many pastures were already damaged. The level of reserves for next winter will be significantly lower and of poorer quality than normal. The cattle ending stock for 2012 is now projected at 49.6 million head, a drop of 400,000 head from USDA?s official number. This is a result of the negative effects of the drought and high temperatures during the key period of service which is expected to produce a smaller than expected calf crop and to a slightly higher slaughter than previously projected. Based on recently released preliminary data, the calf crop for 2011 was higher than USDA?s number. This increase is the result of better weaning ratios because of very good weather conditions in 2010-11 and high cattle prices which encouraged producers to invest more in obtaining the largest number of calves possible. Trade: Argentine beef exports for 2012 are now forecast at 280,000 metric tons, 20,000 tons lower than USDA?s current volume. Again this year the industry expects the government to determine the level of shipments through the administration of export licenses. As soon as cattle or beef prices begin to increase, the government would be expected to restrict export authorizations to ensure stable domestic supplies. Another factor which will negatively affect local exports is the devaluation of the peso which is projected to run at a slower pace than inflation, making Argentine beef exports less competitive in the world market. The main local exporting plant of thermoprocessed beef is currently not shipping product to the U.S. since last year as FSIS found ivermectine residues in some products. The sanitary services of both countries and the company are working to overcome this situation. Exports of thermoprocessed beef to the US in late 2011 were very small and they are expected to continue that way until the problem is resolved. There are currently 120-150 meat packing plants closed, of which 30-40 have federal transit authorization. Most large beef export companies are in a difficult situation due to the small volume they are able to process and sell. A good number of export companies have reconverted their business from exporting to selling into the domestic market. However, if policies and market conditions encourage larger exports, most plants could begin operation quite fast. Production, Supply and Demand Data Statistics: Animal Numbers, Cattle 2010 2011 2012 Argentina Market Year Begin: Jan Market Year Begin: Jan Market Year Begin: Jan 2010 2011 2012 USDA New USDA New USDA New Official Post Official Post Official Post Total Cattle Beg. Stks 49,057 49,057 48,156 48,156 48,856 49,297 Dairy Cows Beg. Stocks 2,100 2,100 2,100 2,100 2,100 2,100 Beef Cows Beg. Stocks 18,300 18,300 18,000 18,000 18,700 18,400 Production (Calf Crop) 11,600 11,600 12,000 12,800 13,000 12,400 Total Imports 0 0 0 1 0 0 Total Supply 60,657 60,657 60,156 60,957 61,856 61,697 Total Exports 1 1 0 0 0 0 Cow Slaughter 3,400 3,400 2,200 2,500 2,400 2,900 Calf Slaughter 2,800 2,800 3,000 3,000 3,200 3,400 Other Slaughter 5,700 5,700 5,500 5,560 5,600 5,200 Total Slaughter 11,900 11,900 10,700 11,060 11,200 11,500 Loss 600 600 600 600 600 600 Ending Inventories 48,156 48,156 48,856 49,297 50,056 49,597 Total Distribution 60,657 60,657 60,156 60,957 61,856 61,697 Not Official USDA Data Meat, Beef and Veal Argentina 2010 2011 2012 Market Year Begin: Jan Market Year Begin: Jan Market Year Begin: Jan 2010 2011 2012 USDA O New P USDA ost fficial O N USDA ew Post fficial O New Post fficial Slaughter (Reference) 11,900 11,900 10,700 11,060 11,200 11,500 Beginning Stocks 0 0 0 0 0 0 Production 2,620 2,630 2,500 2,530 2,600 2,600 Intra-EU Imports 0 0 0 0 0 0 Other Imports 3 3 2 3 2 2 Total Imports 3 3 2 3 2 2 Total Supply 2,623 2,633 2,502 2,533 2,602 2,602 Intra EU Exports 0 0 0 0 0 0 Other Exports 298 298 260 254 300 280 Total Exports 298 298 260 254 300 280 Human Dom. Consumption 2,325 2,335 2,242 2,279 2,302 2,322 Other Use, Losses 0 0 0 0 0 0 Total Dom. Consumption 2,325 2,335 2,242 2,279 2,302 2,322 Ending Stocks 0 0 0 0 0 0 Total Distribution 2,623 2,633 2,502 2,533 2,602 2,602 Not Official USDA Data
Posted: 23 March 2012

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