Uruguayan beef exports on the rise, despite Russian recession

By Charles Newbery, in Buenos Aires

- Last updated on GMT

Uruguay has shifted its attention to China where the middle classes are consuming more beef
Uruguay has shifted its attention to China where the middle classes are consuming more beef

Related tags International trade Beef

Uruguay’s meat exports are rising, with growing production, aggressive promotions and wide access to global markets boosting sales despite a slump in Russian sales.

Exports of offal, meat and by-products increased 8.2% to US$659 million in the year through 9 May, compared with US$609m year-on-year and rose 16% in volume terms to 171,401 tonnes (t) from 147,868t over the same period, according to the country’s National Institute of Meat (INAC - Instituto Nacional de Carnes).

Beef exports led with an 83% share of sales, of which 29% was to China, 24% to North American Free Trade Agreement (NAFTA) countries (Canada, Mexico and the USA), 23% to the European Union, 10% to Israel and 6.3% to the Uruguay’s Mercosur trade bloc (also including Argentina, Brazil, Paraguay and Venezuela).

INAC director general Ruy Fernando Gil said healthy livestock, steady marketing and stable product quality have allowed the country to gain new markets over the years, helping to build export revenue.

"When there are problems in a market, we can switch to other markets to sustain export revenue,"​ Gil said. "If there were problems in Asia, we could switch to the US."

Indeed, while a recession in Russia has reduced orders, Uruguay has shifted its attention to China, where a burgeoning middle class is consuming more beef.

Daniel Castiglioni, director of Montevideo-based food import and export firm Casti Trading, said he expected exports to rise further to China.

"It’s hard to find product to supply all the companies that want to buy Uruguayan beef,"​ he said from Beijing, where he is relocated to handle the rise in sales.

A long-standing buyer of offal, China is now purchasing more quantities of higher-priced cuts, such as bottom round and eye of round, as well as more lamb, he said.

Castiglioni said Uruguay’s aggressive marketing of its healthier grass-fed, antibiotic- and hormone-less beef with ad campaigns, fairs, tastings and themed restaurants, including one in Shanghai, has created a buzz for the product. This has helped differentiate its product in China, a market where it competes against Argentina, Australia and New Zealand.

The next target is Japan, said Guzmán Tellechea Otero, the Uruguayan Rural Association’s representative on INAC’s board of directors. He said access could be granted "in the next few months"​ after years of negotiations, adding that another aim is to export mutton on the bone to NAFTA countries and the European Union.

In the meantime, Tellechea Otero said exports of high-value cuts of beef were likely to increase to the US, where low stocks and high prices have led buyers to look abroad.

With few sales restrictions in the world, the challenge for Uruguay is to increase production from its herd, now at 13.5 million head.

The medium-term targets are to increase the slaughtering to 2.45 million cattle per year and export 500,000t of meat and by-products annually, according to INAC. To 9 May, 814,448 cattle were slaughtered in approved slaughterhouses across Uruguay, an 8% increase year-on-year.

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