Price is obviously a consideration. The live price for Argentine heifers and steers is €1.60/kg - and €1.35/kg for cows. This compares to an average Irish price for steers and heifers of €2.20-2.25/kg, with up to €1.60/kg being paid for cows.
There is a clear price advantage for Argentine beef, add to that the renowned quality of their steaks and you realise that Irish exports could face stiff competition.
In addition, the Argentine herd comes from Angus and Hereford stock – which are perfectly suited to British tastes.
Germany, Chile, Israel, Brazil and Russia are among the main outlets for Argentine beef at the moment but Sebastien says the country is securing new markets and increasing export volumes all the time.
“In 2005 Argentina exported 750,000 tonnes of beef, this dropped to 150,000 tonnes in 2015 but it is expected to reach 400,000 tonnes in 2017,” Sebastien maintains.
He points out that exports to China, Israel and the EU have increased by more than 170pc this year.
He says the fall in beef exports in the 10 years from 2005 to 2015, and the more recent recovery, are due primarily to changes in government policy.
While the populist government of former president Christina Kirchner taxed beef exports, the centre-right administration of the current incumbent, Mauricio Macri, is actually encouraging the business.
However, building exports is a slow process — you can’t just magic up 20 million cows — and Sebastien reckons that it will take around five years to repopulate a national herd that was decimated in the decade up to 2015.
He attributes the recovery in beef exports not only to the Macri administration’s work on lifting the tax burden on beef farmers, but also to his efforts in improving the country’s animal health accreditation and traceability standards.
While he accepts that more work is needed in some areas, the control of FMD has already borne fruit, with both the US and Canada in preliminary talks with Buenos Aires on renewing beef imports.
Russia and China are two other markets which have been identified as outlets for increased volumes of Argentine beef over the next two years.
“With the last government we lost a lot of market share for everything. So he [Macri] is trying make new and long-term deals,” Sebastien says.
The return of Argentina to the beef export scene provides a worrying backdrop to the Brexit negotiations from an Irish perspective.
SCALE AND RICHNESS OF THE PAMPAS SETS ARGENTINA APART
ONCE one of the wealthiest countries in the world, Argentina has had its fair share of problems.
Populist governments, military dictatorships and political corruption has taken its toll on the country’s economy but time and again Argentina bounces back.
That it has been able to continually recover is due in no small part to the resilience of its farming sector.
The scale of the farms in Argentina is mind blowing. My cousins, the O’Farrells, own a 7,000ac farm south of Buenos Aires.
However, it is the richness of the pampas soils which sets Argentina apart. The region around Buenos Aires boasts some of the best land in the country. It is excellent grassland which can also be easily converted to crops.
That is one of the reasons why the Argentine beef herd declined to such an extent during the final years of the Christina Kirchner administration.
Because her government heavily taxed the export of the beef, farmers switched to tillage and increased the area of soya, wheat and maize.
Commodity trader Sebastien Hope points out Argentina is one of the world’s leading exporters in soybeans. The country harvests around 56m tonnes of the crop each year, and exports close to 10m tonnes. In addition, Argentina is a major grower and exporter of maize, wheat and sunflower oil.
Argentina originally was a major wool exporter. But as an Irish sheep farmer, I just hope they don’t start exporting lamb. One of my cousins, Benjamin O’Farrell, just got engaged and his fiancé has 60,000 ewes in the Patagonia.
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