September 15, 2008


Argentina's cattle farmers opting feedlot over grazing

Argentina's cattle farmers have raised their herd on grasslands for years, but they are gradually shifting over to feedlots as high global demand for grains increase.


Lured by the lucrative grain business, Argentina's ranchers are tilling their pastures in crops while cattle are fattened on corn in feedlots.


About 30 percent of Argentine cattle now finish their lives in feedlots compared with zero percentage 10-15 years ago, according to the Argentine Feedlot Chamber.


Feedlot cattle are considered to be more profitable than those raised on pasture when combined with crop production.


One hectare of crops brings in US$500 per year while a hectare in pastured beef is unable to bring in more than US$200, according to Pablo Tassone, who oversees the Nueva Castilla ranch's herd of 24,000 cattle. Nueva Castilla is one of the ranches that are producing crops in their pastures.


Tassone said while feedlot beef tend to be fattier than grassfed beef, he could produce beef with the same quality by feeding his cattle mainly cornhusks. Another advantage to feedlot feeding is that cattle grow faster, Tassone said.


Other major beef exporters such as Brazil and Australia are joining the trend as global beef demand increases on improving middle-class incomes. In the past 10 years, Australian feedlot cattle have jumped 50 percent while Brazil has seen a threefold increase.


US agribusinesses have seen opportunities in this trend, with Tyson Foods announcing last year that it planned to expand feedlot capacity in central Argentina, investing in a 25,000-head feedlot jointly operated by Argentine agribusiness Cresud and Texas-based operator Cactus Feeders.

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