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Three Mercosur members (Brazil, Paraguay and Uruguay) are among the top 10 global beef exporters. Argentina is currently outside the top 10, exporting 230,000t, less than half of what Ireland exports. However, as recently as 2005, it was the third largest exporter in the world with 750,000t of beef exported.
We can expect a regrowth of the Argentinian industry with the election of a free market believing president in November. His predecessor banned beef exports for six month on coming to power a decade ago, to lower prices on the home market. This ban was subsequently replaced with an export tax.
Brazil
Brazil is one of the world superpowers of beef with exports close to 2m tonnes in 2014, though this dropped to 1.6mt last year. This left Brazil third in the export league, behind the USA and Australia. After a prolonged period of Brazil's currency devaluing, its farm gate beef price fell to close to the equivalent of €2/kg at the start of this year. However, the currency has recently strengthened, bringing their beef price to the equivalent of €2.40/kg, which is still among the lowest of major beef producing countries.
The ability of Brazil to develop markets is best illustrated by how it has become established in China. The country received approval for six export factories in June 2015; this doubled by year end and it is expected that there will be over twenty approved soon. In November, China was Brazil’s largest export destination and by the end of February, they had displaced Australia and Uruguay as China’s top supplier, shipping 20,000t. It also demonstrates why the Irish beef industry is so anxious to get approval for China – it could quickly become our next most important market after Britain.
Hong Kong, Russia and Egypt are other high-volume export destinations for Brazil, accounting for 50,000t of beef and 9,000t of offal. Brazil also has a share of the 58,000t Hilton beef quota that the EU has in place to allow limited tariff-free imports from a number of favoured trading partners. Brazil's biggest destination so far this year in Europe has been the Netherlands with 750t, followed by Germany on 417t, Italy on 287t, Spain on 254t and Sweden on 133t.
Uruguay
Uruguay is a country that has many similarities with Ireland. They have a relatively small population and a substantial beef export business of 360,000t. They have a fast growing quality reputation in the global beef trade, with an impressive identification and traceability system. It is also speculated that the entire beef production could go organic at some point in the future.
Uruguay, along with Australia, have the quality end of the Chinese market, shipping 7,500t there in the first two months of this year. This is as much as their next three largest customers, USA, Israel and Canada combined take.
They have also a significant fresh meat market in Europe, taking advantage of Argentina’s export and subsequent production difficulties. The Netherlands is the largest EU market for Uruguay, taking 878t so far this year, followed by Germany on 48t, Italy on 180t and the UK on 100t. Switzerland is a customer for 260t.
Argentina and Paraguay
It is a measure of how far Argentina has fallen that it won’t be able to fill its Hilton tariff-free quota this year. However, it remains South America’s biggest exporter to the EU, sending over 15,000t since July 2015, the start of the current quota year.
Paraguay, though not a significant supplier to the EU, is a major beef exporter shipping 400,000t in 2015. This makes it the seventh largest exporter in the world, just behind Ireland who is sixth. Their main market is Russia which takes almost 40% of their exports, with Israel, Brazil and Chile their other main markets.
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