Beef exporters are carefully following demand from China, Argentina’s main market, after a 2023 of growth in volume but decline in value. This is stated in a work by the Mediterranean Foundation.
The total exports of the cattle complex reached 793,000 tons in 2023, 8.1% higher than in 2022. And the complex was sold abroad worth 2,944 million dollars, about 245.4 million dollars per month, ranking 22.7% below the 2022 record. (in real terms).
Ieral indicated as a relevant element what could happen to meat exports this year the evolution of Chinese demandboth in terms of volumes and willingness to pay for their meat purchases.
China, Israel, Russia, Germany and the United States account for 85% of beef exportsChina clearly stands out from the rest with almost 70% of the sector’s shipments.
According to the report, imports from the Asian giant in volume it will be relatively stabilized compared to the last two years (2.7 million tonnes), accompanied by prices similar to those of the last months of 2023, between 4,700 and 4,900 dollars, which “are relatively low for what the values have been for most of the years. “2021 and 2022,” which were over $6,000.
“One thing to note is that China has a level of animal protein consumption, including all meats and fish, that is high for your income level and this is already close to that of many developed countries, that is, the growth of their internal demand for meat should increasingly converge with the population rate”, clarifies the Ieral text. Furthermore, it added that consultancies and international organizations expect its economy to grow below 5% in 2024, slowing from 2023.
Argentina is the world’s second largest supplier of beef to China, in a ranking led by Brazil, with a market share of around 19%; According to Chinese customs, last year it released a volume of 526,000 tons of meat and bone cuts (product weight) onto the market, the highest figure in the country’s history.
Furthermore, the work focuses on real and effective change (TCRE) for exports (the one that takes into account, in addition to inflation, trade policy, taxes and refunds) since in January it was at a very high level, which far exceeds what it had in 2023 and in the years due to the sharp devaluation of the official exchange rate and also the creation of a “blend” exchange rate regime for the export sector, in which the official exchange rate is weighted at 80% and the dollar CCL at 20%. This value will reach around $900 in January.
“Whether or not the current REER can be maintained is a key question,” he said.
Source: Clarin
