In this framework, it is also highlighted that the increases in the price of meat continue to have a full impact not only on the general index of the basic basket but also on consumption. According to the survey of the Institute for the Promotion of Argentine Beef (IPCVA), in March consumption was located at just 47.7 kg. per inhabitant per year, which marks a year-on-year drop of 2.7% (-1.3 kg/inhabitant/year), which rises to 12% when contrasted with 2019. Argentines are eating less and less meat and the main reason is that the prices of this product show increases well above general inflation in a context in which purchasing power is also extremely weakened.
The data is compelling. According to an analysis by the Rosario Stock Exchange (BCR), the price of roast beef in real terms multiplied almost 5 times between January 2007 and February 2022, going from $4.57/kg to $22.4/kg, showing a rise of 389%. In the same period, the kilo of chicken went from $2.3 to $5.7 (+143%), while the breast of pork went from $5.3/kg to $15.1/kg (+182.1%). In other words, within Argentina all animal proteins saw their real values increase, although this occurs in different magnitudes depending on the type of meat. Consequently, it could be said that beef was the animal protein that saw its real prices increase the most, followed by pork and then chicken.
“For a long time, the demand for beef in Argentina was characterized by having a low income elasticity. In other words, the population did not change their meat consumption to a great extent when their income contracted. Thus, unlike other food consumption, such as dairy products, the consumption of beef became independent of the level of average wages. However, in the last decade there has been a change in this sense, and the consumption of beef has a closer relationship with salary”, they explain from the Rosario entity.
Meanwhile, in the cattle and meat chain they wonder how far the last rise of the standing farm could be transferred to the final prices. It is that the consumer’s pocket is already very punished and everything would indicate that he would continue to restrain consumption or choose other animal proteinssuch as chicken and pork that show lower values, as indicated by the trend.
“It happens that to this context of scarcity of property in which we are transiting, the expectations of a growing inflationary pressure are added, which will exert pressure to sustain these increases. However, demand does not seem to have enough oxygen to assimilate new price adjustments. Neither the butchers nor the counters have room to do so, and even less so exports that, despite the very good values that foreign markets continue to pay, the limitations to grow in volume as a result of the current obstacles make the large industrial structures excessively heavy. to hold In the last six months, since that first strong correction suffered by farm prices in mid-October of last year, after several months of delay, the progress that the prices of fat for consumption -steers and heifers- have been registering has not it can be transferred. From November to March, the current price of these two categories that supply the domestic market accumulates an average increase of 44%, while the average price of the different cuts of beef followed by the IPCVA shows a rise of 35% for the same period”, they indicate from the BCR.
In contrast, the export sector continues to compensate for the drop in shipments, due to the restrictions imposed by the Government in May of last year, thanks to the high international prices that the international market is paying for beef.
IPCVA statistics reveal that last March sales abroad of meat and bones increased 6% compared to February, although they were 5% less than those of the same month of the previous year. Meanwhile, the income obtained was US$292.4 million, thanks to an increase in the average FOB price per ton for the period in question, which was US$9,620 for chilled boneless cuts (implying a rise of US$25 %) and $5,880 for boneless frozen cuts (38% improvement).
Source: Ambito
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