Bloomberg | Jun 06, 2020 02:27
(Bloomberg) -- America’s meat-processing woes opened a window for importers, and Argentina has pounced.
Beef shipments to the U.S. from the proud South American ranching nation jumped to 1,290 metric tons in April, the latest U.S. Department of Agriculture data show. A year ago, U.S. importers bought a measly two tons.
April is the same month that outbreaks of Covid-19 among U.S. meatpacking workers triggered a wave of shutdowns that tightened local supply and sent prices rocketing.
To be sure, Argentine beef exports had already begun to pick up under President Mauricio Macri, who left office in December. Macri negotiated access to the U.S. market, which re-opened to Argentina in late 2018, ending a ban that began in 2001 after an outbreak of foot-and-mouth disease.
Exporters needed time to set up distribution networks to supply top-end American restaurants, hotels and caterers, which wanted quality cuts, said Miguel Schiariti, president of Argentine beef industry and trade group Ciccra.
Shipments started flowing in the second half of 2019, but they surged in April amid the processing logjam in America. While U.S. plants have reopened, they are yet to return to full capacity. Argentina accounts for just 1% of total U.S. imports.
“Argentina was able to take advantage of the supply shortfall,” Schiariti said. “This could be an opportunity to plant a flag.”
Read More: Meat Plant Virus Rates Topping 50% Are Behind Grocery Shortages
Even under President Alberto Fernandez, who prefers intervention over Macri’s free-market approach, the nation’s beef export boom seems set to continue.
Some anecdotal evidence lies in the arrival this week, despite a ban on international travel, of almost a hundred rabbis from Israel to certify Argentine plants as kosher, according to Infobae. Exports of Argentine beef climbed 18% in the first four months to 162,000 tons. China is the biggest buyer.
Neighboring Uruguay also benefited from shortages in the U.S., said Marcelo Secco, head of meatpacker group Adifu. Shipments that cleared customs in April were 3,760 tons, the most since July 2019, according to the USDA.
Brazil’s ability to capitalize was limited given it was only recently cleared to resume fresh-beef exports following safety concerns dating back to 2017.
©2020 Bloomberg L.P.
Written By: Bloomberg
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