Argentina’s Beef Export Ban Would Curb Supplies to China

Argentina, one of the world’s biggest producers and exporters of beef, said it will ban all beef exports for a period of 30 days. The move, intended to curb domestic price inflation, is expected to have repercussions as far as China, the biggest purchaser of Argentine beef. 

Argentina’s action is aimed at quelling inflation, which has forced the government to curb exports despite the Argentine peso’s 28% drop YoY against the US dollar, and their dire need for foreign exchange reserves. 

Argentina supplies nearly one-quarter of China’s beef imports, which jumped 28% in 2020 from the previous year and were nearly double the level from 2018. Gro’s China customs data shows the brisk pace continuing, with beef imports in March at the highest monthly volume since at least January 2020.

Even a temporary shutdown of shipments from Argentina will likely force China to rely even more heavily on Brazilian beef, which already makes up 40% of China’s beef imports. The increased demand, in addition to higher feed costs, have led Brazilian cattle prices to increase more than 72% from this time last year to the highest level in a decade. 

Argentina’s domestic inflation has forced the government to curb exports despite the Argentine peso’s 28% drop YoY against the US dollar, and their dire need for foreign exchange reserves. 

Argentina, which also considered suspending corn exports earlier this year, hasn’t publicly announced a start date for its beef export ban. The move is the latest effort by a national government to limit exports in order to curb domestic food inflation, including restrictions on various grain and vegetable oil exports imposed by Russia, Ukraine, Malaysia, and Indonesia.

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