990522 Disease-Free Argentina Eyes Top Asia Beef Markets

Buenos Aires, Argentine - Argentina is poised to pry open hungry new markets for its fresh beef now that President Carlos Menem has personally applied the final vaccination against foot-and-mouth disease in cattle, industry players said.

"Definitely the new sanitary standard will allow us to access markets previously closed such as Japan and South Korea, which without a doubt are our next big goals," said Oscar Fernandez, manager of processed products for top beef exporter Compania Elaboradora de Productos Alimenticios (CEPA).

New markets are seen as a crucial factor in dragging Argentina's beef exports up from last year's 280,000 tonnes, one of the lowest totals in the past decade. This year's shipments are expected to hit 300,000-350,000 tonnes bolstered by lower domestic cattle prices.

"Freedom from foot-and-mouth will eventually have an impact in the sense that at least four markets not allowing Argentine fresh beef will now import," said an analyst.

Recently Argentina wedged open the Polish market and cemented a deal to sell beef on the bone to long-time customer Israel. Other clients such as Caribbean islands Aruba, Curacao, Jamaica, St. Maarten and Barbados are to buy their initial Argentine cuts this year.

"I think Argentina will be exporting to Japan in one year," said an analyst.

Japan is viewed as the last bastion of huge markets for Argentina to crack after the United States was finally opened in 1997.

It took Uruguay two years to start putting its fresh product on the Japanese market following the elimination of the need for foot-and-mouth vaccinations, said Fernandez.

Japan lines up nearly even with the United States as the world's largest beef importer, buying 600,000 tonnes per year worth $2 billion according to Miguel Goralik, director of Quickfood SA, the nation's fourth-largest beef exporter. South Korea has a yearly intake of about 200,000 tonnes worth $500- $700 million, he said.

Two other key markets for Argentina to zero in on are Indonesia and Mexico, said Alberto de las Carreras, a former Argentine trade secretary and now a vice- president of the Chamber of Exporters.

Argentina won't be officially cleared of foot-and-mouth disease and its shots by the Paris-based International Epizootic Office (IEO) for another year, de las Carreras pointed out. At that point "countries make decisions based on factory visits," though they can conceivably starting importing now, he said.

The new customers are not expected to be heavy buyers at first.

"Beef for table and industry use would be bought in small volumes to begin with until we (Argentina) find a niche," said Fernandez.

Japan is known as a heavy purchaser of U.S. fatty feedlot cuts, while Argentina is renowned for its lean grass-fed variety.

"A few feedlots and slaughter plants here could produce for Japan, which Argentina will treat as a niche market," said the analyst.

On the flip side, Japanese investors may probe the possibilities of setting up shop in Argentina.

"There may now be investment from the Japanese--as happened in Australia's feedlots and slaughterhouses--and from one of the big U.S. meatpackers," he said.

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