In recent years, Nicaraguan beef exports have been on the rise due to the improved quality of the product, but foreign sales of live cattle have been declining due to the deterioration of trade relations with Venezuela.
Official figures specify that between 2019 and 2020 Nicaraguan beef exports increased by 4%, going from $522 million to $542 million.
During the first quarter of the year in Costa Rica 99,662 cattle were slaughtered, 4% more than reported in the same period in 2019, which is largely explained by shipments to the market in China.
Although the spread of covid-19 has negatively impacted most economic sectors worldwide, data from the Livestock Corporation (Corfoga) detail that between January and March 2019 and the same period of 2020, the number of cattle slaughtered increased by 3981, from 95681 to 99662.
In the last five years, beef consumption in Central America increased 4%, from 335,000 tons in 2014 to about 347,000 tons in 2019, growth that was boosted by the Salvadoran and Honduran markets.
Figures from the "Beef Market Snapshot" prepared by the Trade Intelligence Unit of CentralAmericaData, detail that in the last two years’ regional consumption of beef registered a slight increase, since between 2018 and 2019 it is estimated that demand in Central America rose from 341 thousand metric tons to 347 thousand tons.
After the sanitary protocol to sell meat to China came into effect and the industrial plants in Costa Rica were certified, the Central American country's sales to the Asian giant doubled between 2018 and 2019.
Figures from the Foreign Trade Promotion Agency (Procomer) show that in 2018 beef sales to China reached $22 million, while in 2019 they doubled to $57 million.
A 5,000 square meter industrial plant with the capacity to process 95 pigs per hour was inaugurated in the municipality of San Juan Opico, department of La Libertad.
The project, which required more than $5 million in investment, was financed by the U.S. Department of Agriculture, which contributed $2.3 million, and the remaining amount was disbursed by the Salvadoran Meat Industry (INCARSA).
In Nicaragua, ranchers claim that as a result of the tax reform and the inevitable increase in production costs, they have had to increase the slaughter of female cattle by 4%, putting at risk the growth of the cattle herd.
After the approval on February 27, 2019 of the amendment to the Tax Concertation Law, which consisted of raising income tax from 1% to 2% for medium sized companies with higher income, and for large taxpayers from 1% to 3%, the livestock sector has reported considerable increases in its production costs.
From January to March 2019, the countries of the region reported $154 million in sales of beef abroad, and exports to Puerto Rico grew 12% over the same period in 2017.
Figures from the Trade Intelligence Unit at CentralAmericaData: [GRAPHIC caption="Click to interact with graphic"]
Because Guatemalan authorities have not yet completed the health control program, local producers cannot export live cattle to Mexico, where they could sell between 10,000 and 15,000 head a month.
For Guatemalan cattle ranchers, Southern Mexico is an attractive market, because there is interest on the part of Mexican businessmen to buy standing cattle at better prices than those quoted in Guatemala.
Businessmen of the sector estimate that annually they export near $9 million in bovine meat, below the $10 million reported in imports.
For the National Federation of Farmers and Cattlemen of Honduras (Fenagh) it is contradictory that the trade balance is unfavorable, since the annual production of meat is 60 thousand tons, and in spite of having surpluses it is resorted to the import.
After completing all the requirements, Panamanian authorities announced that next June 21 will leave the first container with 200 tons of beef bound for the Asian country.
At the end of March, it was reported that the meat product plants that received the endorsement of the General Administration of Customs of China to start marketing their products were Matadero de Chiriquí, S.A. (Machisa), Unión Ganadera, S.A. (Ungasa) and Macello.
In Panama, the processing plant Union Livestock received the endorsement to market beef in the Asian country, and it is expected that the first containers will be shipped in late April.
At the end of last year, it was reported that the meat product plants that received the endorsement by the General Administration of Customs of China to start selling their products to the Asian giant were Matadero de Chiriquí, S.A.
The barriers imposed by the Honduran and Panamanian markets, coupled with the negative effect of the recent tax reform, force Nicaraguan cattle ranchers to predict a bleak future.
Figures from the National Livestock Commission of Nicaragua (Conagan) specify that between 2017 and 2018 meat exports from Nicaragua fell by 7.9%, from $587 million to $541 million, and in the case of dairy, the fall was 8.4%, going down from $177 million to $162 million.
Negotiations are taking place with companies in Argentina and Paraguay to import beef and supply the local market, which would increase supply and help push prices down.
Representatives from the Ministry of Economy (Mineco) reported that they have already initiated first contacts with companies and authorities of the two South American countries, and that they are waiting for accreditation to show that cattle coming from these markets are free of diseases.
The union for the sector reports that from January to March of this year, they have exported 1,200 tons of beef, and this year they expect to sell abroad around $22 million worth.
According to authorities at the Ministry of Agriculture and Livestock (SAG), during the first quarter of the year there have been good numbers in sales abroad, reporting average exports of 400 tons per month.
In order to increase their sales abroad, farmers in the Dominican Republic intend to raise their farm's productivity levels this year.
Representatives of the guild of cattlemen state that farms in the sector that are dedicated to raising animals for production of milk and meat, have comparative advantages for local commercialization of products and also for their exportation.