May 26, 2008

Argentina to resume beef exports

The Argentine government is expected to resume the issuing of export certificates to meatpackers after the partial lifting of the agricultural strike.

Previously, Argentina's Trade Control Trade Agency (ONCCA) stopped authorising exports in an attempt to pressure the industry to withdraw from the strike.

Around 85 percent of the slaughterhouses ceased operations last week in support of the strike, the Argentinean Regional Meatpacker Federation (FIFRA) said.

The situation has prompted JBS-Friboi to reduce its operations in Argentina, dismissing 1,500 workers.

If the export ban situation persists, other companies such as Brazilian Minerva, will also withdraw from investing in the country.

JBS-Friboi currently produces beef, such as thermo processed beef and Hilton cuts, for the export market, which it is not able to sell in the local market.

The general poor profitability and mid-to-long term prospects in the Argentine cattle and beef industry, affected by live cattle price controls, export bans, taxes, and increasing production costs, appear to have triggered a cattle herd liquidation, with a high percentage of females slaughtered so far this year.