To overcome with convenience the vested interests
CHANGE OF STRUCTURES
Take advantage of the new international context of food prices and demand to develop the enormous agricultural potential offered by the privileged natural conditions and comparative advantages of Argentina. Take advantage of the extraordinary dynamism and efficiency already demonstrated by the agricultural sector in the measure that the structures that overwhelm it are changed.
This change must be projected with the agreement of all the actors looking for a framework of mutual convenience that surpasses the immediate interests, through a participation in the growth. The official compulsory measures, without consensus, of officials who ignore reality do not serve. For example, the minimum weight did not increase the average weight, the Federal Law was inapplicable, traceability is an export barrier, and so on. If all those involved are not consulted with experience, decisions are detrimental or at best, unusable chair papers that feed the bureaucracy.
The speed of the transformations in Argentina is a constant when there are incentives of profitability, remember the bulk harvest, cooled sections to the emptiness, the direct sowing (the saving of fuel and labor weight more than the ecological advantages) the gathering with Pockets, hybrids, synthetic breeds etc.
The Argentine competitiveness of the beginning of the last century neighborhood of the international market of meats to the United States. Starting from pajonales with Creole cattle the technological and commercial structures were created that converged in quality and price; Reaching to export 700,000 MT / year. Quality discriminated by a private typification that rewarded (arbitrarily) the price according to destination: Chilled or Frozen. Special trains of 1000 fat steers, even, British, of 500 kg, up to 2 teeth, came from the alfalfares of the West. Ripened during the trip was the best meat in the world …. Until postwar.
A colossal (short-term) investment of private capital and multinationals that import inputs and export production, financing technological packages applied with efficient scales such as the one that occurred in the 90s before the tailwind, is not Replicable in livestock. To cultivate one hectare are enough 400 to 600 U $ that recover in 6 months. In that same soil are necessary from 1000 to 1500 U $ in bellies that are recovering partially in several years. Who puts the millions of heads that are missing.
The popular imaginary, some politicians and technical technicians presuppose a natural production from inexhaustible and gratuitous haciendas and pastures, such as the sea, but do not know that agricultural prices inexorably displaced the agricultural frontier, marginalizing livestock, especially the reproductive to more difficult environmental conditions Which demand large investments (long term) with legal certainty and a profitability horizon that did not occur in livestock. In breeding and fattening systems are more complex and expensive.
Nor do they know that in livestock there are no packages, but process technologies that exist but because of their complexity require management of highly trained personnel.
The increase in production in the breeding, did not come and will not come in the short term with a greater number of cows but if in the medium term with reproductive efficiency. A great increase of production in the rearing and the finishing if it can come in the short term by the intensification (already initiated) of the use of grains for supplementation and confinement. Prices are required to offset these higher costs. Relative prices that surpass the preference for the beef leaving place to the substitutes with better conversion efficiencies.
The next volume target is half a million tons more meat, obtained by projecting 10% more weaning and 25 kg more working weight, with 5 million tons of ration and a consumption of 50 kg per capita. The next objective is one million more meat with 10 million more ration (Graph 8). The transformation of about ten tons per hectare of maize with supplements means a conversion into beef of 10 times the value of that maize per ha, in swine 20 times, in poultry 30 times. Brazil has long understood it.
The next objective of value is to triple the price of exported meat by replacing the lowest value cuts with the most expensive ones (provided quality is guaranteed), which would ensure a qualitative location of privilege in the international market, better than the loss . To make 100,000 tons of Rump & Loin you need half a million steers and heavy heifers. As if to start roasting and empty. Unlike other meats that can be produced in other countries, Argentina’s potential to produce quality (guaranteed) beef is unique in the world because it has the largest genetic herd of British genetics, the largest potential area of temperate grasslands, Large grain production and the best technology for low-cost, extensive systems.
Our flesh will not regain global leadership without policies that promote high quality Who will supply consumers with growing purchasing power (China alone has more than 5,000 5 star hotels). We will continue competing in 2nd with Brazil and Paraguay or we will go down with the buffalo of India. We are condemned to mediocrity, daughter of Creole synonymous synonymous with corruption or we prefer success son of effort.
In the very short term (3 months), a large production of meat could begin to dump the market by fattening the empty bellies to replace them with replacements (there are almost 4 million unproductive mothers). Besides contributing to alleviate the supply bias caused by retention, it would also change the productive efficiency of livestock.
Short-term (1 year) in the Humid Pampa (70% of the stock) thanks to the races
British and grains could be achieved a great increase of the exportable production increasing progressively the weight of work without losing quality. If the cattlemen agreed, to reverse the historical relationship of the higher cost of production and lower selling price of the heavy. In short, change the contribution to the task by passing the novillitos to steers and the heifers to heifers. (Figure 7).
In the medium term (5 years) there is a great opportunity for the development of livestock in marginal farming areas: to convert grain to meat, with no retentions and 10% of freight in foot, or better with 2% if it is cold freight Of regional refrigerators that would occupy the country’s cheapest labor force. Producers of marginal climatic zones to be able to access the consumer market with quality should continue to reduce their size, weight and age of slaughter, making the most of their herds or replacing the Indica component with Taurus rusticas and sending the calves to wintering Shorter in agricultural fields.
Everything is based on a higher price of the heavy and that is sufficient for the rapid increase of the weight of work. It will contribute to this price, the greater purchasing power of the export with a transfer of consumption task to enabled plants and a progressive painful bleaching. Take advantage of the “Rioplatense Singularity” for all the work. Argentina and Uruguay are the only countries in the world where consumption prefers cuts of meat of lower exportable value that are the majority of beef. But here, paradoxically, the people subsidize the rich (when export does not compete).
Associating by mutual convenience the consumers to the exporters, the first ones as sellers of RAL, or as users with better cold to mature what they have left; The latter with less idle capacity and much more quality cuts to process.
The 5 most expensive cuts of export represent (w / bone) only 15% of beef. The 5 cuts of the wheel for consumption or export (oven or Milanese) 25%. Only 35% of the 11 cuts for roasting are left for consumption, 25% of the 6 cuts for stew, or puchero, or chopped. (Graph 6)
With 130 kilos of average res (450 kilos alive) per ten million heads slaughtered reaches to cover the consumption and begins to spare for export. The most important thing is that it is a quality export that triples its value and affirms an exclusive competitiveness.
If consumption delivers most of its expensive cuts and part of the wheel if it is left over, the more it is exported, the more meat will be left for consumption at a lower price without lowering the price of the live animal and although it may increase to encourage An indispensable greater production and to give place to the substitute meats. There will be more meat for consumption, at a lower price …. Yes, it’s tender !!
The tenderness and pastoral quality should once again be the unrivaled competitive advantage of the Argentinian beef, thanks to its mostly Angus herd and the extension of its prairies (both very easily certifiable on the beach), both for consumption Domestic and for export. Although the boat time matures the cooled meat, this does not equal the quality of the fresh one by airplane. The productive objective should be a lightweight export calf with quality for consumption: 450 kg would suffice in destination and also valorize the young cow and heavy heifers exportable. The tonnage of heavy females should exceed 40% of the total slaughter. (Graph 7)
The increase in production, consumption, and exports will occur when the entire hacienda, whether apt and heavy, for fishing on beaches that are capable of having similar costs, transfer the most expensive cuts to the export market.
All points must be considered simultaneously so that each real incentive adds to the overall effectiveness. They did not serve or serve the professed aspirations of the goodies, without sustenance of costs and prices.
Price: should be lower than any exporter of lower quality, so that external demand is unlimited; For which our currency parity should contemplate the level of income of potential buyers of quality. Beluga’s claim would be unlimited if it were not worth three million dollars a ton. We can not be more expensive than countries that triple our individual income.
Export release (immediate effect) Eliminate all customs restrictions (ROES). Any fee or permit is a source of arbitrariness with its correlate of returns. It removes predictability of compliance to trade agreements and paralyzes futures.
Retentions: (immediate effect) eliminate the expensive cuts of RAL Lomo, Bifes wide and narrow, Rump, heart and cover). Regular part of the cuts of the wheel according to the internal supply (Buttock, Peceto, Square and Ball of loin) and to maintain it for all the grill: (Roast, Skirt, Empty, Colita, Matambre, Entraña, Tapas, Pallet) and Boiling or stewing: Palomita, Tortuguita, Chingolo, Aguja, Garrón, Brazuelo, Azotillo) The export of cheap cuts to less than $ 3,000 a ton conspires politically and does not suit the country that should export the most expensive to more than 10,000 Dollars. It already happened when 300,000 tons were exported to Russia and banned until the smallest.
Grant refunds to products with higher added value: specialties, prepared, portions cooled by aircraft and frozen portions, after ripening to distant destinations, thermo processed, canned, and differentiated by certified qualities. The customs have the systems (Maria) to process all the necessary information (the DGI, the exporters would oppose, until the consumption them the RAL, and the restaurants would oppose.) It would be approved by the whole chain of the consumption: refrigerators, slaughterers, butchers and consumers).
Slaughter weight (immediate effect) removing the Pussycat slaughter weight, restriction absconding and will be overtaken by the convenience of the voluntary slaughter weight increased, thermometer success of these proposals. Calves will remain for a low consumption of very high purchasing power. There was and will not be an increase without solving the antinomy of the higher cost of production with the lowest selling price. Profitability would be slowly rebuilt with longer reaps of cheaper forage and finishes with less expensive concentrates. It would also be recomposed with the replacement of light socks by more tender cuts, palatable and cheap because they are surplus of greater light exports of very young animals with some maturation. Provided they are backed by quality labels. Also for the unit costs that are not calculated in the production and if they are calculated in the industry. Especially if proportional taxes are replaced per unit. The relief of immediate triggering effect, would initially act, until the quality effect of the heavy young people is imposed in the domestic market, as it happens in the world.
Traceability: (Mediate effect) is a requirement to track establishments involved in health problems. Extend and / or simplify any system simpler to implement than the present to allow the entire task is potentially exportable if ne qua non condition. Whatever system is designed, every animal, at a minimum cost, should be able to access all export destinations, including EEC. No producer should be able to move one leg without identification: source field button, whatever its destination.
It does not reach SENASA’s structure or personnel to quickly extend the current system to the previous movements of a slaughter of 10 million heads per year; Nor at a sidereal cost for all. Sanitarily interested in finding only the establishments where the problem was generated, without the madness of individually identifying millions of heads. This tracking, very occasionally, reduces to one millionth the current state and private bureaucracy that could be better dealt with in sanitary controls and in monitoring quality assurances. The external requirement of the individual record is an interested phantom.
It is suggested that only the establishment of origin of each animal should be identified in each transfer by means of two buttons (Probability of loss 1/10 000), with a reduced code of letters and numbers (RENSPA current) the province, party or Department and birth establishment. That button (breeder) recorded in the successive documentation of transfer (DTA) would allow to trace all the movements from the birth to the slaughter of each animal. Each producer would declare in each movement the amount of ups and downs of the animals of each origin in their record filed in SENASA computers. This reduces system costs for all, without TRI or anything that resembles it. (Producers, exporters, slaughterers and slaughterers would support it), SENASA would oppose it with the support of the “caravaneros” and the “systematists”.
Eliminate the veterinary service registration, which is paid and not met (check the language in the clamp for each referral to the EEC)
Criminalization: (immediate effect) Eliminate the current and replace it with another objective that sort and not qualifying. Quality is rewarded by the market. Although necessarily optional, it will also guide production. The interested parties would apply with the endorsement, the sponsorship and the control of the SENASA (sampling in camera, observing the ossification of the cartilages, the grain, etc.). Periodic monitoring helps but an internationally valid audit and a code of effective sanctions to avoid verbal trout are essential. For example, external sanitary inspections are of inescapable rigor.
This classification should classify categories only by dentition without limits of weight or sex, by the gap before the headworm, and the biotype before the neglect. This way, the young and tender heaviest heifers would be valued for consumption. It is also possible to control the pasture or confinement conditions in the market, for the markets that award it, and in the quartet, the veining and even the objective tenderness. (They would strongly oppose the slaughterhouses the producers of old animals and the associations of small races Tender, be supported by those who require cattle with guaranteed tenderness and those who produce them). Both classifications of more than 2 teeth and those of other biotypes that punish the lack of quality would automatically cause the inexorable veto of the system. Which Butcher would like to receive a marked 6 Z.
That’s why it has to be optional. As for the industry, little grace would make the producers ask them to improve the price for quality; But it is the only way to promote it. For Chile, it is mandatory to teething to import and as we are distrusted, they verify it.
Tax reform: (Mediate effect) To equate slaughtering costs of slaughterhouses with that of slaughterhouses, changing the proportional taxes per head tax (eg a fixed tax VAT). Fixed costs that are diluted in heavier cattle that are 20% more efficient in transport, slaughtering, dismantling, cameras, etc. It should be national legislation such as the Federal Meat Act. (Would be opposed by the slaughterhouses and the slaughterhouses, until they fit in. They would be conditioned by gray producers but would be supported by exporters, AFIP and even co-sharers.
A fixed and limited reduction of profits: the value of 50 kg. For each medium between 120 and 130 kg of weight, for both sexes. It would have a huge impact on the weight of labor. Only the increase in the weight of consumption is encouraged, excluding the others. Impositively it is neutral because Kg is undone that would not have occurred. Although it only serves the fatteners who pay profits, they represent the bulk of the offer. The small producers that are the majority, does not reach them as well as partially, other exemptions (fertilizers). Instead, it would be better for them all to reverse the price differential between light and heavy, offsetting the higher costs of heavy.
It is not possible to control the evasion of the relief by kg live, (error of Krieger Vassena). It is possible if it is per kg of beef that is fished in establishments with beach of slaughter, which means, in addition to bleaching, a transfer of slaughter (would strongly oppose the consignees of the market, the slaughterhouses, would condition the Feed-Lots and the DGI and would be supported by large producers and exporters).
Transito: (immediate effect) to adapt the health requirements to facilitate the transfer of cuarteos export abattoirs to exporters (SENASA conditional resistance, would support only the enabled consumeros and exporters).
Competition: (delayed effect) stimulate facilitating the adaptation of the beaches slaughter and quartering of large slaughterhouses and necessary to enable the transfer of cuts to exporters, with long – term loans cameras. It does not reach the existing capacity of beaches with cameras for 48 hours of cold to enable for export a much larger part of the work of 10 million heads.
To perfect and update the federal traffic law and extend it to the municipal level. Require cold levels for the transfer of cattle. The provinces that apply it will have a more solid industry. To the mayors, to finance the habilitation of the plants and to redistribute taxes to them (the political leaders, the colgaderos and the gray and black operators would be strongly opposed, would support the AFIP and the exporters, would condition the authorized abattoirs and the producers).
Quality certification: (Mediate effect) should be the lever that projects the recognition and appreciation of the best Argentina meat in international markets,
Take advantage of the growing purchasing power of the world’s population that will access the middle class (4 million tons more by 2030) to develop our quality potential. Unique quality, without competition, the acme can be summarized as follows : Marbled cuts matured vacuum of media res 130 kg RAL from a neutered male or better a female, with baby teeth, of predominantly British origin, recriada and well Finished to pasture with supplementation. All these attributes are easily verifiable in plant at a reduced cost for a large volume. Certifications are always optional but could be initially rewarded with refunds. A sort of green label internationally recognized for overprices. (Exporters are strongly opposed to those who do not produce quality and the empire of “being equal”).
Hilton: (Mediate effect) legislate an automatic distribution of quotas by verifiable parameters that discretion does not depend on anyone, eg: FOB selling price and weighted average Triennial Past Performance, only the value of the cuts RAL. To recover lost prestige, the quota should be the spearhead to certify a quality of origin as that of many foreign products recognized and protected. (Eg, grass taurus, 2 teeth, veined etc.). They would strongly oppose the privileged exporters and the politicians who distribute them, would support the new competitors.
Maturation: (delayed effect) the consumer who discovered hand feed-lot tender veal do not need ripening so be zebu, it is unwilling to return to bygone times with ice bars in the refrigerator of the house And beat Milanese. The investment in cold for 7 to 15 days will not do either the slaughterers or the slaughterers who want to charge yesterday, nor the super with high rotation of finished products, if the export refrigerators and slaughterhouses could do if they had financing Adequate and clearer rules. (Although the cold is cheap in relation to the price premium for quality, inflation and oil losses would be strongly opposed.) The reduction could be alleviated by pocketing only the cuts without bone to roast.
Yield: (Mediate) It would be necessary to apply the dressing control regulation, but failing that, it would be much better if it were obligatorily paid for the weight of a first balance before the collapse of the kidney, electronically connected to the liquidation. The refrigerator could estimate the yield to the distemper of each res with equations similar to those scientifically tested in the SENASA-UBA-AACREA study appropriate to the desgrase that suits him, done after that first balance. (The refrigerators and associations of lower performance breeders would be opposed by good performance and slaughterers).
Health: well as successfully controlled the disease, with the same emphasis should extend the controls to other diseases (STDs) with more stringent national plans. This is a minor issue that corresponds to the scope of SENASA. In addition, campaigns are needed to disseminate practices and treatments that reach massively to raise awareness among producers.
Technological diffusion: Producers of over 1000 heads can pay advice if they apply the available technology. Over the range of producers between 100 and 1000 heads, responsible for 60% of production, would have to finance a massive technological diffusion in each party Until now did not happen or will happen without a huge promotion of the state that is spelled out but is incipient. Although it is very slow, there is going to be a process of replacing those who make livestock or have no scale for the cattle pools with greater technological efficiency and financial availability.
The proven experience of CREAS, the examples of Marcenaro in the Serenissima and Latinoconsult, are examples to repeat now; Such as the Marfrig system for its group of suppliers, the extension of demonstration producers with credits assisted by INTA. Meetings organized and funded by IPCVA and other institutions should be multiplied. They may not reach the funds provided, but it would be their best destination.
Although they have very little production projection, small producers with less than 100 heads representing more than half of the total (Chart 1) deserve to be helped to incorporate technology and capital. Before liquidation they had less income than a staller, now they can progress. They should be grouped as a condition for sharing infrastructures financed by long-term soft loans assisted and controlled by system advisers. The rebates are not enough.
The small agricultural producers, historical memory of the settlers, are economic inviable by scale. Today they are small landowners with the income they negotiate with contractors, but paradoxically, if small livestock producers are viable in an intensive livestock farm that with a small investment would value their work.
Representation: is essential to the integration of the entities, as in other countries and other chains like our wine. Only immediate benefits coupled with obvious and important mutual conveniences of participation in a major development would overcome the existing disagreements. It would help cohabitation in mixed institutions (private-state). Prior to agreements that could be forced with the official recognition of a single federal representation by sector. (In addition to sectoral interests, trade union personalities, expectations of political figuration, and traditions of historical conflicts that are not in force today) are opposed.
Luis de Santa Coloma, November 2015
EVOLUCION PRODUCTO BRUTO INTERNO
(fuente: Roberto Cortés Conde.)
EVOLUCION SALARIOS REALES