Domestic demand for beef does not recover

Fridge entrepreneurs questioned government for ‘being very comfortable with current stagnation’ in meat price

For iProfessional

06/01/2023 – 11.43

The Argentine refrigeration industry exported 10.1% more in January and November 2022 in a year-on-year comparison, while in the local market the decrease in demand for beefmainly due to the prices.

A report from the Chamber of Industry and Commerce of Meat of the Argentine Republic (CICCRA), which specified that 825,000 tons of beef were exported during the period under review. Billing for these overseas sales was $3,238 million, an amount 27.9% higher than the same period in 2021 and with an average price per ton of $5,600.

On the other hand, CICCRA warned that from August 2022 the refrigeration industry faces a process of decline in demand for beefmainly by prices and to a lesser extent by volumes.

At the same time, he indicated that the deterioration in purchasing power of households translated into a slight drop in domestic consumption: all this together contributed to explaining the significant slowdown in the annual growth rate of the average price of live animals, which in the last twelve months recorded an increase of 31.6 % and a decrease of about 32% compared to the general level of the Internal Index of Wholesale Prices (IPIM) elaborated by INDEC.

Second semester 2022: “Very bad”

As a result, the corporate entity warned that the second half of last year “it was really very bad” for the livestock and industrial sector, since international prices “have fallen sharply and the domestic market is not yet able to recover consumption and validate rising prices”.

Faced with this landscape, also complicated by drought, CIRCLE considered a price recovery necessary to rebuild profits and increase output.

Despite the increase in exports, domestic demand for beef has not recovered

At the same time, he accused the government of “being very comfortable with the current stagnation of the price of meat. We believe that they have not lifted the export constraint to prevent the increase from exceeding 70% on the counters in the second half of the year”.

He also underlined that last December the average price of live cattle traded in the Cañuelas market continued to recover, against a backdrop of declining numbers of animals sold. The monthly increase It was higher than in November, but still not enough to fully recover the decline seen between August and October, according to business analysis.

Thus, the average price increased by 4.1% in December compared to November and remained at $265.8 per month live kilo, but it remained 2.4% below the peak level recorded in August. Meanwhile, the total number of heads sold decreased by 10.2% per month (91,021 heads) during the last month of 2022.