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LMIC Study Tour of the Beef Industry in Argentina and Uruguay

¿Dónde está la carne de vaca en la Argentina y Uruguay?. LMIC Study Tour of the Beef Industry in Argentina and Uruguay. It is said…. There are only three things that are important in Argentina…. Futbol (Soccer). The Tango. And Beef!. Argentina – The Country. Argentina – The Country.

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LMIC Study Tour of the Beef Industry in Argentina and Uruguay

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  1. ¿Dónde está la carne de vaca en la Argentina y Uruguay? LMIC Study Tour of the Beef Industry in Argentina and Uruguay LMIC Study Tour 2007

  2. It is said… There are only three things that are important in Argentina… LMIC Study Tour 2007

  3. Futbol(Soccer) LMIC Study Tour 2007

  4. The Tango LMIC Study Tour 2007

  5. And Beef! LMIC Study Tour 2007

  6. Argentina – The Country LMIC Study Tour 2007

  7. Argentina – The Country LMIC Study Tour 2007

  8. Argentina has 3.761.274 Km2 area (slightly more than four times the size of Texas). Latitude ranges from Havana, Cuba to Central Alberta. Argentina – The Country LMIC Study Tour 2007

  9. Argentina – The Country Tropical Ag Region Main Beef Production Region Semi-Arid Ag Region LMIC Study Tour 2007

  10. Stock distribution . . . 7% 25% 6% 2% 60% The “humid Pampa” LMIC Study Tour 2007

  11. Argentina – The Countryside • Rainfall • Coastal areas i.e., Humid Pampas • 945 mm ~37 inches • Central inland areas, i.e., Cordoba, San Luis • 525 mm ~ 20 inches • Temperatures • Coastal areas i.e., Buenos Aires • 5C to 29C or 41F to 84F • Central inland areas, i.e., Cordoba, San Luis • 4C to 31C or 39F to 88F • Soils are comparable to better US corn belt LMIC Study Tour 2007

  12. Argentina – The Cattle • Although an accurate count doesn’t currently exist… • Best Estimates are: • 54 Million total cows • 5+ Million Dairy • ~ 49 Million Beef • 200,000 producers • 400 slaughter plants • 100 plants are export certified LMIC Study Tour 2007

  13. Argentina – The Cattle • 100,000 producers have <25 head • Average herd size is 1,000 – 1,500 head • ~ 10,000 producers hold 40% of the cattle • Large ranches tend to be very large • E.g., Estancia Don Roberto in San Luis Province • i.e., 38,560 hectares (95,283 acres) • 20,000 head of mother cows (Hereford & H. Crosses) • Split over 5 separate estancia’s LMIC Study Tour 2007

  14. Argentina – The Cattle • Year round grazing pasture system • Some “finished” cattle (up to 25 pct of total) • Supplementation on pasture with silage or grain • Bulls are in from Sept – Dec • Calving occurs from July – Oct • Average calving rate is 60 percent +/- up to 85 pct • Slaughter preference is for light animals • 250kg to 400kg or 550lbs to 880lbs 12 – 14 mos. post weaning • Cull cows are typically finished then slaughtered LMIC Study Tour 2007

  15. Argentina – The Cattle • Feedlot finish • 2 ½ cycles per year, empty 3-4 months • 4 - 20,000 head lots • 1,000 – 5 to 10,000 head lots • Many, many under 5,000 head lots • Fed cattle focus is for the export market • Top 3 markets are: EU, Russia, Asia • High corn prices have impacted here too… LMIC Study Tour 2007

  16. Argentina – The Cattle • Disease status • FMD free with vaccination • OIE BSE free status • After Falklands war with UK in 1982 all imports from UK, EU were stopped. LMIC Study Tour 2007

  17. Breed standing in Argentina • English breeds dominate • ~ 74% Angus or Hereford • ~ 11% Brangus and Braford crosses • Used in Northern (Equatorial) provinces • Heat tolerance & pest resistance • ~ 15% in 20+ other breeds LMIC Study Tour 2007

  18. Cattle are in a 3 tier system . . . • Purebred • Registered cattle • Pure Controlled • Essentially purebredbut not registered • Commercial Cattle LMIC Study Tour 2007

  19. Argentina – The Cattle • By Federal Law… • NO growth implants • NO low level anti-biotic in feed • Treatments for problem cattle allowed • Preventive vaccinations allowed • Animal ID • Initially was voluntary • Needed for export to EU • EU requires farm to table traceability • Now program is mandatory LMIC Study Tour 2007

  20. Argentina – The System • President Néstor Kirchner ordered “voluntary” price controls to “control” 9% inflation – March ‘06 • Argentinian’s consume more beef per capita than any other country (~146 #/capita) • Meat is 9% of the CPI • Eat 50% more than US • Beef export tax tripled to 15% • Imposed a near-total ban on beef exports • now at 20% of pre-ban level • also banned exports of wheat, wheat flour and corn • capped prices paid for cattle at Liniers Market • Measures have largely backfired LMIC Study Tour 2007

  21. Argentina – The System • Government & Intervention • Tax System • Permits required to move animals to slaughter • 1% Gross income tax • Export taxes levied on beef • Ag export taxes equal 6% of government revenue • Due to high cost of corn some export taxes are rebated to cattle feeders to lower feed costs and cost of beef. LMIC Study Tour 2007

  22. Argentina - The Market • Domestic consumers prefer grass fed, fresh beef • Most shop daily or frequently for meals • A very close relationship exists between • Cattle brokers & Butchers • Butchers (local markets) and shoppers • Fresh means 24 – 48 hours • from Moo • to BBQ! LMIC Study Tour 2007

  23. The Liniers Market – located in Buenos Aires - assembles yearly about 20% of the cattle slaughtered for domestic consumption (around 2.6 Million head) LMIC Study Tour 2007

  24. Argentina - The Market • Domestic consumers spend up to 30 percent of disposable income on food • Estimate 40 percent of population is below the poverty line • BBQ is popular cooking method • Cuts are different from US standards • Variety meats also popular • Brains, sweetbreads, kidneys, liver, heart, etc. LMIC Study Tour 2007

  25. Argentina - The Market LMIC Study Tour 2007

  26. Argentina - The Market LMIC Study Tour 2007

  27. Argentina - The Market • Exports are key to the economy • Russia • Fzn cuts, boneless front qtrs, Mfg cuts • U.S. • Mfg Cuts, thermo cooked meats • TRQ 20,000 metric tons • EU-25 • High quality loins, ribs LMIC Study Tour 2007

  28. Argentina production & exports (000 tons cwe) Dr. Roberto Vázquez PlateroABARE Outlook 2007 LMIC Study Tour 2007

  29. Cattle Feeding in Argentina • Cactus – AR • 25,000 head capacity • Several partners including Tyson • Cattle sourced up to 800 km LMIC Study Tour 2007

  30. What goes to market? • Grass fed is most production • Some exported (EU mostly) • Most used domestically • To maintain tenderness most animals are slaughtered at <24 months +/- and 250 – 400 kg live weight • Dressing 56 – 59 percent (kidney fat removed) • Grain fed go mostly to export • On feed for 100 – 120 days • EU finish at 400-420 kg. (880 – 925 lbs) • Dressing 59 – 61 percent LMIC Study Tour 2007

  31. LMIC Study Tour 2007

  32. Nearly the same size and latitude as Missouri On to Uruguay • Agriculture and Agri-industry account for 23% of GDP • and over 67% of total exports • Major industries are • meat processing, agribusiness, wood, wool, leather production and apparel, textiles, and chemicals LMIC Study Tour 2007

  33. Uruguay – The Country • No mountains and only 3% of land is forested • Over 80% suitable for agriculture • Productive native grasslands • Soil classes mostly not well suited for crops • Crops utilize ~8% of land area • Livestock utilizes ~80% of land area LMIC Study Tour 2007

  34. Uruguay – The Country • Rich agricultural land 90% devoted to livestock. • Cattle, sheep, horses, and pigs are the major livestock animals. • Rice is the major food crop, followed by wheat, corn and sugarcane. • Agriculture contributes nearly 12% to the GDP and is the largest exporting sector. • The manufacturing sector accounts for nearly 30% of the GDP. • The processing of agricultural and animal products accounts for about half of the manufacturing activity. LMIC Study Tour 2007

  35. Uruguay – The Cattle • British breeds dominate • Approximately 75% Hereford • Approximately 20% Angus • Other breeds make up the remaining 5% • 11.5 mil head cattle • 500,000 Cert. Organic • Cow calf production system is similar to Argentina • Grain Finishing is limited • Cattle imports banned • 10.8 mil head sheep • 760,000 dairy LMIC Study Tour 2007

  36. Uruguay – The Cattle • 100% traceability through a mandatory national animal ID system LMIC Study Tour 2007

  37. Uruguay – The Cattle • By Law… • NO growth implants • NO low level anti-biotic's in feed • Disease status • FMD free with vaccination • OIE BSE free status • No cases of food borne E. Coli including the O157:H7 strain LMIC Study Tour 2007

  38. Uruguay – The Cattle • With limited cropping, grass fed is major market • Instituto Nacional de Carnes (INCA) • meat export board • Marketing Uruguay as “Small and Green” LMIC Study Tour 2007

  39. Uruguay – The Cattle • USDA Process Verified: • Certified Organic • Certified Natural • Certified Hereford • Certified Uruguayan Angus LMIC Study Tour 2007

  40. Uruguay – The Market • Agriculture (8.9% of GDP) • Products--beef, wool, rice, wheat, barley, corn • Exports (f.o.b.)--$3.4 billion • meat, wool, hides, leather, wool products, fish, rice, furs • Major markets • United States (22%), Brazil (13%), Argentina (8%), Germany (4%) (2005 Data) LMIC Study Tour 2007

  41. Uruguay production & exports (000 tons cwe) Dr. Roberto Vázquez PlateroABARE Outlook 2007 LMIC Study Tour 2007

  42. Uruguay – The Markets • 35 Packing plants • 19 export approved, Cert. Organic • Production total 627,000 tons carcass wt. • 20% domestic use, 80% exported • 51% male, 49% female • 471,000 Metric Tons Exported • Value (USD) $960,000,000 LMIC Study Tour 2007

  43. ¿Alguna Pregunta? ¡Gracias! LMIC Study Tour 2007

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