April 3, 2006

Argentinian export ban props up beef prices

The cost of imported beef in Europe has soared by as much as 30 to 35 percent after Argentina instituted a self- imposed beef export ban last month.

An 8-ounce piece of sirloin from South America, which normally cost EUR2.60 (US$3.14) now costs EUR3.50 (US$4.23).

The unexpected price hike is putting fixed-price procurement contracts with large catering firms, hotels or restaurants in jeopardy and some may have to be broken, suppliers said.

Suppliers would try to protect their key clients, but those who buy in lesser volumes or have no contracts could be badly affected, said Ian Gauld, director at purchasing consortium Tricon IPA.