Beef shipments from Argentina to the EU have completely stalled as global coronavirus outbreak hits food supply chains.
Argentine beef shipments have skyrocketed in recent years, fuelled especially by demand in China, helping the South American nation boost beef exports to $3 billion in 2019. The European Union accounted for 9% of beef exports.
However, according to reports by Reuters the coronavirus pandemic has arrested the market, clogging global trade and hurting demand in a hit to Argentina.
China, where the coronavirus outbreak first appeared, has been in lockdown since the start of the year with strict quarantine measures that have hit the food service sector and prompted beef demand to plunge.
Argentine meat industry officials said the market in Europe, now at the centre of the pandemic, had seen demand collapse even harder, basically paralyzing exports to the region that normally buys pricier cuts of the South American country’s beef.
“In Europe practically all restaurants are closed because they are in quarantine and beef in Europe is basically consumed in restaurants,” said Miguel Schiariti, director of the Argentine Chamber of Meat Industry and Commerce (CICCRA).
“Importers said ‘stop, don’t send me any more’.”
It comes as Meat Industry Ireland said Irish processors, particularly in beef and lamb, are under pressure to maintain throughput levels given the loss of the important food service market channel.
"The COVID-19 pandemic is causing serious devaluation of finished livestock prices as key market channels and certain EU markets are effectively closed and the mix of sales through retail outlets is skewed heavily towards lower value cuts.
"MII has communicated these market issues to all the stakeholders and to the Government. While traditional market supports (intervention and APS) may not work in this case, other forms of support must be brought forward by the European Commission without delay,” it said.
ICMSA has called for beef imports from outside the EU should be suspended immediately as they specifically target the steak market which is under most pressure at this time in the absence of a food service market”, said the Livestock Committee Chairperson.
Mr Morrison said that such a suspension is justified based on the exceptional circumstances we find ourselves in and the imperative to protect our own beef sector from this temporary shock until such time as the EU beef market returns to stability.
“Profitability in the beef sector is already extremely low and the EU Commission must immediately deliver market measures and action that provides farmers with a level of confidence required to continue to produce high quality sustainable beef”, concluded Mr. Morrison.