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Um Jornada: South American Beef Tour, Week 6

27 Jul

By JACOB MAYER

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During our stay in Buenos Aires we visited Mercado de Liniers, the world’s largest stockyards.  During its peak, 40,000 head of cattle per day were sold through its gates.  During our visit they were selling a mere 10,000 animals each day.  Mercado de Liniers sells cattle Monday through Wednesday and Friday.  All of the cattle sold through the auction go to slaughter, there are no feeder cattle.  There are between 50 and 60 packing houses in Buenos Aires and on the day we visited, 35 of them had buyers present.  Instead of bringing the cattle into a central location, buyers walk from pen to pen and cattle are sold from the catwalks.  Due to the large size of the market several auctioneers sell cattle simultaneously in multiple places.  The auctioneers move rather quickly and spent less than two minutes at each pen.

Ranchers consign their cattle through one of the many consignment companies.  For this service the seller pays a commission between 6 – 7% and the trucking costs.  Cattle are brought in late at night, sold and shipped the next day by 2 PM, and slaughtered that same day or the morning of the next day.  The animals are weighed when they arrive and when they are shipped; the average of these two weights is the pay weight.  Finished cattle were bringing ARS$6 – ARS$7 per kg (US$0.71 – US$0.82/lb) on a live basis at the time of our visit.  What we would consider sound, quality cattle brought the same price as cattle that were in poor condition because there are no incentives for producers to raise quality cattle.

The Pontifical Catholic University of Argentina hosted a seminar for our group and we listened to several speakers from the school discuss some of the same issues Mr. Hayes had shared with us the previous day, but from a more academic perspective.  There were a few new topics of interest that were brought up.  One major issue affecting the cattle industry is the expansion of row crops, especially soybeans, in to the fertile Pampas region.  Grazing and beef production is being pushed off onto more marginal land to make way for the more profitable enterprises.

We were surprised to learn that most of the cattle in Argentina are owned by small producers, much like the United States.  There are approximately 146,000 operations with <100 head of beef cattle in Argentina and only 32 with >10,000.  A typical operation can expect to see a weaned calf crop between 60 – 65% of the number of exposed cows.  The cattle in Argentina are primarily British influenced and 80% are Bos Taurus with the most common breeds being Angus, Hereford, and Angus X Hereford (Black Baldy).

Retailers in Argentina offer 30 – 40 different cuts of beef.  Prices for these cuts vary significantly, but those who can afford them prefer the round and loin.  Most of the beef is still sold through small family owned butcher shops.  The average Argentine citizen knows a lot about meat and how best to prepare it.  There is very little ground beef, although it is becoming more popular  with young people.

Our last speaker, Rodrigo Troncoso, works for the Argentina Feedlot Chamber an organization that represents nearly 500 feedlots.  This industry did not exist 15 years ago, but because of the expansion of row crops the Argentine cattlemen have been forced to become more efficient to stay competitive financially.  There are around 2,200 feedlots in Argentina that finish between 5.5 – 6 million head per year, which is about 45% of all the fat cattle in the country.

Our group really enjoyed learning more about the beef industry in Argentina from so many different perspectives, but what we were most excited about is the next leg of our trip to the province of San Luis to see the things we had heard about for ourselves.  Check back in next time as we visit an American owned feedlot and a large Hereford ranch.

Until then – happy trails and God Bless,

Big Jake

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