BUENOS AIRES, Argentina – Argentine President Nestor Kirchner has a plan to fight rising inflation and food prices: Let them eat beef.
In an extraordinary decision, the government this week announced a six-month ban on most beef exports from the world’s third largest exporter of the meat.
In Argentina, prime beef is a cultural icon, rivaling tango, soccer and the late Eva Peron. Argentines are voracious beefeaters, consuming 143 pounds of beef per capita each year, 50 percent more than U.S. consumers.
But consumers here have been grumbling about beef prices for months, and Kirchner – a left-leaning populist often at odds with big business – presented the ban as a move to protect his people from export-driven price hikes.
The government hopes that meat targeted for exports will now stay at home. Increased supplies will reduce domestic prices, which skyrocketed some 20 percent last year – surpassing the worrisome inflation rate of more than 12 percent.
“It doesn’t interest us to export at the cost of hunger for the people,” Kirchner declared.
Kirchner’s edict took effect Friday, and delighted shoppers rushed to butcher shops to inquire whether prices had dropped from the $2 or so a pound for prime cuts that can go for ten times as much in the United States and Europe.
“The president’s move was absolutely necessary in the moment we are living,” said Hector Polino, who heads a consumer group critical of rising prices. “Beef is the principal food of habit in Argentine culture.”
From a political standpoint, Kirchner’s bold stroke should also help shore up his constituency as he contemplates re-election next year for another four-year term.
But cattlemen said Kirchner’s move would kill the golden calf. Beef exports earn vital foreign exchange and amounted to a record $1.4 billion last year – a 24 percent increase to almost 600,000 tons.
Cattle farmers say the export ban was likely to reduce supplies in the long term, cost them hundreds of millions of dollars and throw thousands out of work.
“The plants will begin to shut down,” Carlos Oliva Funes, president of the large Swift meat producer, told the conservative daily La Nacion.
“This is like telling Colombia it cannot export coffee,” said Javier Jayo Ordoqui, who heads a ranchers association outside Buenos Aires. “This is cattle country.”
Indeed, prices of beef were reported to have plunged Friday by as much as 20 percent at Liniers, the country’s largest live cattle market, where brisk sales were reported in apparent response to the export ban. Economists predicted modestly lower prices would eventually trickle down to consumers.