China Acquires Majority of Argentina’s Beef Exports Amid U.S. Inventory Decline

China will buy 70% of Argentina’s beef exports as U.S. cattle inventories decline. President Javier Milei has lifted a long-standing ban on live cattle exports to boost competition. In 2024, Argentina exported over 935,000 tons of beef, with prices significantly lower than in the U.S., which faces reduced herd sizes and rising costs.

China is set to acquire 70% of Argentina’s beef exports, including live cattle, amid dwindling U.S. livestock inventories. President Javier Milei announced a pivotal change allowing Argentine ranchers to export live cattle for the first time in 52 years. This decision is part of efforts to enhance competition in the meat sector and align with Milei’s broader economic deregulation agenda. In 2024 alone, Argentina exported over 935,000 metric tons of beef, marking its highest export level since 1924.

The USDA reports that Argentina has expanded its beef exports significantly, with 29.4% of 2024 production destined for 53 international markets, an increase from the previous year. China remains the dominant buyer, consuming nearly 70% of these exports, while other markets include the European Union, Israel, and the United States. The USDA predicts that Argentine beef exports to the U.S. will continue to be strong due to high import demand and competitive pricing.

As of early 2025, Argentina’s beef retail prices range from $2.19 to $3.11 per pound, in stark contrast to the U.S. price of $5.55 per pound. Analysts attribute the higher U.S. beef costs to reduced cattle inventories, the smallest they have been since 1951. As per USDA data, cattle and calf numbers in the U.S. totaled 87.2 million on January 1, 2024, reflecting a 2% decrease from the previous year.

The U.S. cattle industry faces challenges due to rising operational costs, prompting many ranchers to downsize or exit the business. The situation has garnered attention, particularly in light of significant changes within federal departments and the ongoing political environment. Furthermore, President Milei’s collaboration with figures like Elon Musk indicates broader economic ramifications that could influence international agricultural trade.

In summary, China’s decision to purchase a substantial portion of Argentina’s beef exports, paired with Argentina’s historic ability to export live cattle, marks a significant shift in the global beef trade landscape. The U.S. faces increasing challenges due to reduced cattle inventories and high operational costs, underscoring the need for strategic adjustments within its agricultural sector. The evolving dynamics also highlight the complex interplay between international trade and domestic agricultural policies.

Original Source: www.newsbreak.com