RIO DE JANEIRO, BRAZIL – Argentina has announced a 30-day suspension of meat exports amid soaring prices that have raised government concerns over losing control of inflation, ahead of congressional elections to be held later this year.
The government said on Monday it will implement the emergency measure due to the “sustained increase in the price of beef in the domestic market,” confirming information anticipated by federal administration and industry sources earlier in the day.
The government added that during the 30-day suspension other measures will be implemented to improve the regulation of meat exports. The export ban may eventually be reduced to a shorter period if other measures are successful in lowering prices.
“Exports have been closed. Tomorrow we will continue negotiating with the government,” said a source in Argentina’s meat sector linked to ABC exporters’ association, adding that he assesses the measure as a mistake even amid the backdrop of rising prices.
Following the announcement of the measure, Brazil’s Marfrig, the global leader in beef production, said its operations in Argentina accounted for 3.2% of consolidated net revenues in the first quarter.
“Therefore, the direct impact of this restriction is limited to 1.3% of consolidated net revenue, represented by Argentine exports in the period,” the company said in a statement to the market on Tuesday.
Minerva, with operations in other South American countries besides Argentina, has the option to offset its sales from production in other nations. Questioned, the company declined to comment.
In recent years, Argentina had been expanding meat exports, mainly to China, helping to boost the sector, but also sparking fears that rising exports could pressure domestic prices.
The country’s government seeks to defend its strong position in Congress in the elections later this year and increase its popularity with voters, battered by the coronavirus pandemic.
Argentina is the world’s sixth-largest global beef producer and was the fifth-largest exporter in 2020, according to the U.S. Department of Agriculture.