April 2, 2011

Argentine cattle herd to recover by 2018

The Argentine cattle herd is forecast to return to 2006 levels (58 million head) in approximately seven years, according to Argentina's Confederation of Rural Associations (CARTEZ).

A series of negative policies applied by the Argentine government (aimed at increasing domestic supplies), and a severe drought which hit the region in 2008 and 2009, have resulted in the cattle herd falling 11 million head over the past four years.

According to CARTEZ's model, the herd will recover based on the assumption of a 3% annual growth in the breeding herd (given lower female slaughter rates) and improvements in the weaning rate - driven by higher weaner prices.

In addition, CARTEZ based its assumptions on stable domestic consumption of 58kg/person per annum (down from around 70kg in 2009), a stable turnover of approximately 12.8 million head, and exports of around 300,000 tonnes cwt - less than half the volume exported in the mid 2000's.