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Argentina on Tuesday said it would allow cattle farmers to resume the export of beef to China, lifting a cap imposed earlier this year. The move is being viewed as a signal that Argentina, one of China's biggest beef suppliers, is back on track for free trade with the China market that it cannot afford to lose, analysts said.

The Argentine government had capped beef exports at 50 percent of normal volumes to ease domestic prices and halted exports for a month in May as it grappled with inflation. The suspension led to protests and threats by local farmers to halt trading in cattle and grains, a Reuters report said.

Dong Jingsheng, the deputy director of Peking University's Latin America Research Center, told the Global Times on Wednesday that the move to get free trade back on track means that despite some ups and downs, South American countries will not lose the opportunity of exploring the rapidly growing China consumer market.

China is Argentina's second-largest trading partner and an important partner in investment and financing cooperation. According to data from the National Bureau of statistics of Argentina, from 2003 to 2020, the bilateral trade volume between Argentina and China more than quadrupled from $3.2 billion to $14 billion.

China, the world's largest beef consumer, has been Argentina's largest customer, accounting for 75 percent of the country's beef exports. 

South American meat producers have been highly successful in exporting to the Chinese market over recent years, treating the latter as a cash cow, as China's demand for cheaper meat products climbs.

In 2020, China imported beef from 29 countries including Brazil, Argentina, Uruguay, Australia, and New Zealand, and Brazil was the largest source of imports, with an import volume of 848,400 tons, accounting 40 percent of the total beef imports globally, customs data showed.

However, exports competition has become fiercer in 2021.  

Russia has overtaken its rivals including Argentina, Brazil and Australia in beef exports to the Chinese market, which are likely to grow further over the next five years, the Center for Industry Expertise (CIE) of Russia said, according to a Russia Today report in July.

The CIE revealed that China bought 3,700 tons of Russian beef in the first quarter of 2021, more than 20 times more than during the same period in 2020. More than 55 percent of Russia's total cattle meat exports go to the China market.

Global Times