ARGENTINA is the eighth largest country in the world in terms of land mass and has a population of just under 40 million people. Agriculture has been a core element in the national economy since the first European settlers developed vast estancias, or ranches, on the great plains.
British breeds of cattle, predominately Aberdeen-Angus and Hereford, were first imported in the late 1890s and soon became the foundation stock for one of the largest beef producing countries in the world. During the 20th century huge quantities of b
eef were exported to the UK and Europe. The quality was excellent and the demand insatiable. This, in turn, saw leading cattle breeders from the pampas arrive each February at the great Perth Bull Sales searching for the best Scottish bloodlines. Price was no deterrent.
However, times have changed in recent years – so much so that Argentina is expected to be a net importer of beef within the next 18 months. Political turmoil is not new in South America, but in the past agriculture has been largely immune. No longer.
The per capita consumption of beef in Argentina is the highest in the world at close on 64kg – the Scottish figure is little more than 16kg. Despite this, Argentina's farming industry has depended on exports – but the government, keen to assuage domestic pressure, two years ago imposed an export tax on beef. At the same time, a parallel levy was placed on wheat. These moves, in conjunction with the worst drought in living memory, have brought the agricultural industry close to total collapse.
Malcolm Rodman, who runs a herd of Angus cattle north west of Buenos Aires as well as operating as a consultant, visits Scotland regularly and is totally depressed at the way his country's farmers are being ignored.
He said: "We are expecting to have to import beef as from 2011, and we will only have enough wheat to cover internal consumption next year – and that is only if it starts to rain.
"Even if it does rain, most farmers are looking at alternate grains such as oats, barley and any other product that does not involve an export tax.
"The country considered to be one of the breadbaskets of the world, well known for its steaks and wines, is falling towards international oblivion."
The international league table of beef prices at the end of May puts Argentina very much in the relegation zone. A decent steer in that country is worth little more than 97p per kilo on the hook – Scottish farmers are currently receiving close on 290p per kilo.
In addition, large numbers of breeding cows have been slaughtered as a result of the prolonged drought, so even if trading conditions were to improve it would be many years before there was any increase in production.
The latest international meat market review, complied by the economics division of the UK-based Agricultural and Horticultural Development Board, predicts that exports of beef from Argentina this year will drop at least 26 per cent. That forecast is borne out by the most recent statistics: in the first three months of this year, the UK imported just 508 tonnes of beef from Argentina compared with more than 1,200 tonnes in the same period of 2008.
Rodman's assessment of the current situation is gloomy in the extreme. He said: "Up until March 2008 and after six years of tremendous growth at 8 per cent per annum, Argentine farmers increased production and improved yields creating new wealth in the country.
"Last March, we hit a stone wall and it has been downhill ever since as a result of irresponsible government intervention. The politicians say that they want to distribute wealth, but what they have yet to discover is how."
Wholesalers
Bringing Home The Beef
