Argentina’s Beef Exports Surge to Record High Amid Weak Domestic Demand

According to a report released by the Rosario Board of Trade, as Argentina’s domestic beef market struggles with weakened demand, the country’s beef exports continue to gain momentum.

In the first half of 2024, Argentina’s beef exports reached a record 454,711 tonnes, the highest volume ever recorded for this period, based on data dating back to 1990.

This result represents a 10% increase compared to the first half of 2023 and an 18% rise over the five-year average for the same period.

According to the report, beef exports in the first half of this year accounted for 30.6% of the country’s total beef production, a record share of 5 percentage points higher than the five-year average, which stands at 25.6%.

One key factor driving this strong export performance is increased sales to China, Argentina’s largest international beef buyer, which accounted for 57% of total exports in the first six months of this year.

The chart below shows which were Argentine beef exports’ top destinations in the first half of 2024. The data is from DataLiner.

Argentina Beef Destinations | Jan-Jun 2024 | TEUs

Source: DataLiner (click here to request a demo)

Revenue Stagnates

Despite the 10% increase in export volume, revenue for the first half of the year remained largely unchanged, totaling $1.346 billion—just 0.1% higher than the same period in 2023 and in line with the five-year average.

However, the revenue generated during this period only trails the record $1.676 billion achieved in the first half of 2022.

The stability in export revenue is attributed to a decline in the prices of exported Argentine beef. In the first half of 2022, the average export price was $4,406 per tonne, while the average price dropped to $2,959 per tonne this year—a 33% decrease over the past two years.

Reversing Downward Cycles

Nevertheless, analysts at the Rosario Board of Trade are optimistic about beef prices in the coming months, citing strong international demand. According to the USDA (United States Department of Agriculture), this demand is expected to reduce global beef stockpiles by 9.7% this year.

The report projects that international beef prices will rebound by 2025, following the reversal of the liquidation phase in the cattle cycles of key suppliers like Brazil, the United States, Argentina, and Uruguay.

Pork Sector

Argentina’s pork market is not heavily export-oriented, as it primarily focuses on meeting domestic demand. As a result, the report notes that only about 3% of the country’s pork production is typically exported.

In the first six months of 2024, Argentina exported 6,676 tonnes of pork, a 3% decrease from the previous year and 47% below the five-year average.

In terms of trade balance, Argentina traditionally imports more pork than it exports, resulting in a trade deficit, according to the Board of Trade.

In the first half of 2024, with exports totaling $5.8 million and imports reaching $16.5 million, the pork sector’s trade deficit was $10.7 million. This figure is an improvement over last year’s deficit of $31.4 million and also better than the five-year average deficit of $26.8 million for this period.

Poultry Sector

Products derived from the local poultry industry contribute approximately 9% of Argentina’s total production to the international market.

In the first half of 2024, Argentina exported 94,000 tonnes of poultry products, a 21% increase over the previous year, generating $108 million in revenue, according to the report.

With imports amounting to $4 million, the trade surplus for the poultry sector in the first half of this year was $104 million.

The Board of Trade notes that although this surplus is 18% higher than in the first half of 2023, it remains 28% below the five-year average.

Source: Portal DBO

Click here to access the original news piece: https://portaldbo.com.br/exportacao-de-carne-bovina-da-argentina-bate-recorde-historico-no-1o-semestre-24/

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