Since the beginning of the year, news from the agricultural and livestock sector has been dominated by the consequences of the climatic drought that was felt well into March of this year.

Within this context, one piece of news that went more unnoticed was the upturn in the livestock sector, caused by a higher value of exports and stable domestic consumption, which favoured the existence of exportable surpluses.

The following report provides an overview of the dairy and meat production sectors for Argentina, with the latest data updated in mid-March.

dairy production

Dairy production in Argentina has improved over the past four years, approaching the peak of 12.000 billion liters reached in 2015.

In 2022, 11.557 billion liters were produced, although the herd for dairy farming continues to decline with 1,58 million heads registered in 2021.

Graph 1: Reception of millions of liters per month. Primary milk production. From 2019 to 2022.

Regarding the economic sustainability of the sector, in February 2023 the input-output ratio was 1,4 kg of corn per liter of raw milk, which shows a downward trend of 22% below the average of the last 5 years.

That is, each additional liter of milk produced can buy 22% less corn than the average of recent years.

In terms of demand, local consumption of dairy products has remained stable over the past 5 years, with per capita consumption of 187,8 litres equivalent in 2022.

However, dairy exports continue to increase. In the last year, the export volume increased by 4,3% to 412 thousand tons, although the value is still below that of 2011.

Graph 2: Annual evolution of per capita dairy consumption. In lts. of equivalent milk. 2015 to 2022.

The largest increases were seen in powdered milk, both whole and skim, and semi-hard cheeses and mozzarella. The value of exports increased by 25% compared to 2021, registering a positive sum of 1.675 million dollars in the trade balance.

As regards the climatic setback at the beginning of the year, if the effects of the drought continue to affect current production, there will be upward pressure on domestic prices.

If the La Niña phenomenon recedes and the availability of water and animal feed improves, production will not be affected as much, and the outlook would be more encouraging for both the sector and families.

meat production

As for the cattle herd for meat production, a downward trend has continued to be observed since 2019, with an approximate stock of 53,4 million heads for 2021.

In this regard, the province of Buenos Aires concentrates more than a third of the national herd, followed by Santa Fe and Córdoba, Corrientes and Entre Ríos, which maintain an approximate herd of 4,5 million heads per province.

Graph 3: Stock of cattle from 2008 to 2021.

In 2022, a higher level of beef production was recorded, which reached 3,2 million tons, but a decrease in the herd is projected due to the sale of bellies.

Graph 4: Evolution of different aspects of work. From 2020 to 2022.

In terms of external consumption, beef exports recovered, with an increase of 12,1% compared to 2021, reaching 900 thousand tons and recovering the level of exports achieved before the 2021 restrictions.

China is the main final destination, followed by the European Union, Chile and Israel. In addition, international prices have risen on average, generating a greater inflow of foreign currency than in 2021.

Total domestic meat consumption rebounded in 2022 compared to 2021, with beef remaining the most consumed, with an average of 48 kg per person per year.

However, a strong substitution of beef by chicken meat is observed until 2020.

Chart 5: Evolution of consumption by type of meat and its relative prices. From 2016 to 2023.