Argentine

Meat exports in Europe had collapsed for Argentinian producers

Beef

External sales of beef cuts will close the year with a 17% drop in values. It is due to the sharp drop in prices in a context of lower global demand and the virtual closure of the European market due to the new restrictions.

Posted on Nov 18 ,09:48

Meat exports in Europe had collapsed for Argentinian producers

The second wave of the coronavirus pandemic that affects several of the most relevant countries in Europe in terms of imports of Argentine products, is having a full impact on beef exports.

In September a volume similar to the previous month of around 4,800 tons was exported, although with a noticeable drop in prices. And in recent weeks, as the Covid lockdown progressed in various countries, marketing has virtually come to a halt.

"The European market is destroyed, we are not shipping anything, this second wave of Covid has terribly affected the commercialization and in fact, we have no values", said Mario Ravettino, president of the ABC Consortium, which brings together the largest bovine exporters.

The values of 12/13 thousand dollars per ton that were in force until two months ago fell to 6000/6500, but without real demand.

Ravettino admitted that prices have fallen in all markets - also in China they lost up to 30% of the value - but in Europe the issue is that quality cuts are sent to hotels, restaurants, catering, and all that is stopped.

Víctor Tonelli, an analyst of the beef market, recalled that between July and September, prices of up to US $ 13,000 per ton were paid in Europe but "now you cannot sell for US $ 7,000 a ton".

This will impact the export result, with a fall in foreign exchange earnings of between 15% and 17%. "The US $ 3.5 billion last year, we do not believe that this year will exceed US $ 2.9 billion", Ravettino anticipated.

For his part, Tonelli stressed that "China has good demand but there, too, prices have dropped".

While in 2019 a record price of US $ 6,500 per ton was paid, today it is around US $ 4,600, after having reached minimums of US $ 3,600 per ton. It is a market supplied exclusively looking for volume and not with quality cuts.

In spite of everything, the year will still end with almost 950,000 tons exported between fresh and frozen meats, indicated Tonelli, a not inconsiderable number.

A report from the Rosario Stock Exchange (BCR) points out that in September "taking the prices of two of the cuts most demanded by Europe, such as the wide steak and the RAL Hilton (narrow steak, loin and square), a collapse was observed. of more than 40% with respect to the values paid at the beginning of August".

The point is that with the resurgence of Covid and the return of restrictions on circulation in countries such as Germany, the Netherlands, Spain or Italy, there are fewer buyers and it is not known when demand will recover.

For its part, the Argentine Bovine Meat Promotion Institute (IPCVA) indicated that chilled boneless meat represented 28.1% of exports in September. In contrast, cuts with the lowest unit value, including boneless frozen ones that are sent to the Chinese market, accounted for 66.6% of total foreign sales in the ninth month of the year and bone-in frozen ones 5.1% .

The IPCVA highlights that in September 72.9% of the beef exports by volume, both fresh and frozen, were shipped to China. In the first nine months of 2020, 320,892 tons went to China, out of a total exported of 440,341 tons.

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