Paraguay’s Beef Exports Reached Historic Profit & Await US Market Access

Published 2021년 12월 14일

According to a recent report from the National Service for Animal Quality and Health (SENCASA), Paraguayan beef exports have reached a historical export value of USD 1.3B in the first ten months of 2021. In terms of volume, exports have also reached an all-time high of 283.2K MT of exported beef between January and October. Overall meat exports have increased by 70% in the first three quarters of this year, and profits are expected to reach by the end of the year the historic milestone of USD 2B. Additionally, the Paraguayan beef industry is currently awaiting USDA approval to enter the US market, which will place Paraguay as a new rising beef exporter.

Bans of beef exports in Argentina and Brazil have helped consolidate Paraguayan beef in the international market. Unlike Argentina, Paraguay's government supports a very free-market approach to agriculture conducive to exporting beef. Like Brazil, the Paraguayan beef industry has had issues related to foot-and-mouth disease (FMD) and additionally faces significant logistic challenges that come with being a landlocked nation. However, despite these obstacles, the country’s beef industry is thriving, and it is a rising star on the export front.

Historical Year for Meat Exports in Paraguay

So far, 2021 has seen historical records set by Paraguayan meat exports. According to the SENACSA report, over 283.2K MT of beef has been exported between January and October 2021 for which already is an all-time high exported volume. In 2020, beef exports accounted for 272K MT all through the year, for which 144.9K MT were from fresh or chilled bovine meat and 157.14K MT of frozen bovine meat. It is expected that beef exports in 2021 will reach around 300K MT by the end of the year, and if so, the exported volume will have a 10.4% increase from the previous year, closing the best year in beef exports so far.

Source: ITC Trade Map, SENACSA

According to the SENACSA report, in terms of value, beef exports for the first ten months of 2021 reached USD 1.3B. As a result, this year’s export profit will also reach a historical record for Paraguayan beef exports. In 2020, Paraguay recorded USD 1.1B in both fresh and frozen beef exports, for which USD 590K were from frozen beef and USD 524.4 from fresh beef exports. If exports keep their increasing trend for the last two months of the year, profit is expected to reach around USD 1.5B, representing a 36.4% increase from the previous year.

Furthermore, overall meat export items, including beef and its offal, pork and its offal, poultry meat and offal, and products of animal origin, are expected to reach an unprecedented USD 2B profit in 2021. If so, Paraguay will be reaching a historic profit milestone in meat exports and would have a 70% growth compared to 2020 figures when overall meat exports reached USD 1.18.

Possible US Market access along with solid growth in traditional Markets

One of the critical aspects of Paraguayan beef exports in an increasing trend is that there has been continuous growth in its traditional markets and recent inclusions of new markets. According to the SENACSA report, Chile has remained the primary market for beef products in 2021 with 116.8K MT sent and has seen an increase of around 14% from the previous year. Russia follows it with 70K MT sent, then Brazil (25.8K MT), Taiwan (25.42K MT), and Israel (15.3K MT). In the first half of the year, Paraguay has become the fourth-largest beef supplier to Taiwan and is expected to grow its importance in this market considerably.

Enrique Albera, Tridge’s Engagement Manager in Paraguay, has reported that since mid-November, a delegation from the United States Department of Agriculture (USDA) has arrived in the country to audit the local beef industry to determine whether Paraguayan beef may enter the US market. “In 2022, Paraguay hopes to increase beef exports by adding the US market as one of the important destinations for these products. Beef unions in the country estimate to get the qualification for the year 2022”, he informed.

Source: ITC Trade Map

Daniel Burt, president of the Paraguayan Meat Chamber, shared with Tridge about the major significance of US market access. For him, it is not just about the US aces but all the markets that can potentially follow. He explained, “Once we are authorized by the certification process for the USA, we foresee the authorization to other different countries. So if the USDA approves you, it’s normally easier to be granted authorization to reach other markets that can have plenty of potentials”, he added.

According to Mr. Burt, there is plenty of confidence within the beef sector that Paraguay will be able to export beef to the US market after the November audit. “The USDA has visited ten meat facilities, and within 30 days, we will have the statement with the audit results,” he explained. Paraguay hopes to obtain a similar quota of those granted to Uruguay and Argentina by the US, 20K MT tonnes a year.

Additionally to the US market, Paraguayan beef exports are expected to start exports to Saudi Arabia, South Africa, and Turkey. All recently announced the opening of their market to Paraguayan beef as a measure to release the shortage in beef from Brazil and Argentina.

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