April 11, 2011
Argentina announces multi-million dollar investment in beef industry
The Argentine government announced on Thursday (Apr 7) that it will launch a US$735-million investment to boost the country's beef industry, which was recently surpassed in production by neighbouring Uruguay and Paraguay.
The National Cattle-Raising Plan (Plan Nacional Ganadero) was presented by President Cristina Fernández de Kirchner and Minister of Agriculture Julián DomÃnguez, who declared that the objective is to increase productivity and reach 77 million head of cattle within five years. According to data from the sector, in 2010 Argentina exported only one in 10 kilos of beef produced in the country, the lowest export rate since the 2001-02 crisis in the sector sparked by foot-and-mouth disease.
The cattle headcount also dropped from 60.1 million in 2006 to 48.2 million in 2010. The crisis in the beef industry has been largely blamed by agricultural producers on the government, who they accuse of not incentivising the sector and intervening in export markets. In this context, a large number of beef producers have switched from cattle to soy, a more profitable business.
President Fernández has thus chosen to listen to the sector in an electoral year (general elections are due in October), giving subsidises with low interest to the farmers. Nevertheless, it will be difficult for Argentina, the world's top beef exporter in its recent past, to surpass Paraguay and Uruguay, now ranking far ahead amongst the 10 largest exporters of the product.
