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MFBF Vice President sees South American beef industry first hand

Montana Farm Bureau Vice President Bob Hanson had the opportunity to be a part of the Beef Study Tour to Argentina and Brazil. The 14-day trip, Jan, 19 – Feb 1, was designed to provide participants with a first-hand, in-depth look at the makeup and competitive positions of the Brazilian and Argentine beef cattle industries. Hanson’s overall thought after visiting cattle operations, feedlots and livestock sales was that Argentina and Brazil are not a threat to U.S. beef producers, at least not at this time.

Hanson found the trip to be interesting and insightful. “I know there is concern that Hoof and Mouth Disease could come into the U.S. from Argentine beef and Argentine cattle, but the truth is that Argentina really doesn’t have enough beef to export, and most of what they export goes to Europe, not to the U.S.,” Hanson noted. “Any meat that does come to the U.S. must, by U.S. law, be processed, meaning it’s not a threat to our livestock. There has been a concern in Argentina about Hoof and Mouth Disease coming in from Paraguay, so the Argentine beef producers vaccinate semi-annually against the disease. They are very serious about eradicating Hoof and Mouth Disease in their country.”

Hanson said that the pampas, formerly grazing land, are now being turned over to crops, thus reducing the land—and amount of cattle—to graze there. “Unlike the western United States, which has a lot of open land that is only good for grazing, Argentina doesn’t have that. They get 40 inches of rain there, so they’re plowing up 1 million hectares a year for crops such as soybeans, corn and even sunflowers, and taking cattle grazing off grasslands. Right now grassland economically can’t keep up with the price of grains.”

He pointed out that despite the Argentines telling the tour group that they’re building feedlots, one cattle feedlot they visited that has a capacity for 25,000 head only had 16,000 head, even though the government is paying a subsidy to producers for putting cattle in a feedlot for 90 days.

The Argentine government has been involved in keeping its beef supply plentiful for its population. “We were told that the government has limited its beef exports to 50,000 metric tons per year. In addition, the government has put a price freeze on domestic beef because they want to keep it affordable. Interestingly, the per capita consumption of beef in Argentina is higher than in the U.S.,” Hanson explained.

Hanson, a cattle producer from White Sulphur Springs, said that Argentina acquires much of their genetics and seedstock from Montana, so he saw plenty of quality Angus and Herefords that were very similar to Montana cattle.

As for Brazil, Hanson noted that the country has a huge population with Sao Paolo being named one of the three largest cities in the world—and they need to feed their people.

“Interestingly, Brazil tends to have a lot of cattle around that aren’t being productive. Because of the type of cattle they raise—a Brahman-type cross—cows aren’t bred until they’re three years old. They don’t slaughter animals until they’re 42 months of age. Again, like Argentina, they’re eating most of their own beef, so at this time, there’s little chance of them exporting beef and cattle to the U.S,” said Hanson.

“Considering the fact that both countries are losing grazing land rapidly, I predict that they’ll be experiencing a decline in the amount of cattle produced, not an increase, and I don’t see them exporting a lot of beef and cattle to the U.S. anytime soon,” he concluded.

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