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USDA International Egg and Poultry

23 July 2014

USDA International Egg and Poultry: ArgentinaUSDA International Egg and Poultry: Argentina

In September 2014, a meeting is to be held between the members of the Pacific Alliance and Mercosur.
USDA International Egg and Poultry

July 29, 2014 Mercosur will hold its next summit meeting in Caracas, Venezuela after 4 failed summit meeting attempts since December 2013. Possible results and topics of interest will include the hopeful ascension of Bolivia into Mercosur as an official full member, the transition to Argentina as the new rotating leader of Mercosur, and discussions about strengthening ties with the Pacific Alliance, India, and the Eurasian Economic Union. Another topic would be further discussions about the free trade agreement (FTA) negotiations with the European Union (EU), which have been ongoing since 1995.

The week of July 14, 2014 a series of meetings were held in Brazil first of which being the 6th summit meeting of BRICS, which is a trade block formed in 2006 consisting of Brazil, Russia, India, China, and South Africa. Also in attendance were Argentina, Venezuela, Ecuador, Colombia, Peru, Uruguay, and Paraguay. During the meetings Russian President Vladimir Putin expressed interest in establishing relations and expanding trade opportunities with the Union of South American Nations and Mercosur. Putin also announced plans to sign a cooperation agreement between the Eurasian Economic Union and Mercosur in early 2015 after the establishment of the Eurasian Economic Union becomes effective. The Eurasian Economic Union is an economic union comprised of Belarus, Kazakhstan, and Russia effective in early 2015; Armenia, Kyrgyzstan, and Tajikistan have also expressed interest in joining. The Union of South American Nations was formed in 2008 and is an intergovernmental union of two existing customs unions, Mercosur and the Andean Community of Nations. Mercosur is a customs union formed in 1991 made up of full members Argentina, Brazil, Paraguay, Uruguay, and Venezuela in addition to its associate members Bolivia, Chile, Colombia, Ecuador, Guyana, Peru, and Suriname. The Andean Community of Nations is a customs union made up of Bolivia, Colombia, Ecuador, and Peru, which was formed in 1969.

In conjunction with the BRICS meeting, another meeting was held between India, Argentina, Brazil, Colombia, Ecuador, Paraguay, Peru, Uruguay, and Venezuela. During the meeting Prime Minister Narendra Modi expressed the need for India to work more closely with Mercosur and to better utilize the Preferential Trade Agreement between India, Mercosur, and Chile to expand trade. India has already appointed experts to send to South America in the areas of agriculture, horticulture, disaster management, communications, law, and renewable energy. India has also set up centers in South American countries to share its expertise in information technology. South America has become an important contributor to India’s energy and food security. This was the first time India’s Prime Minister has ever met with so many South American countries at one time.

In June 2014, Uruguay enacted into law the incorporation of Bolivia into Mercosur. Despite Bolivia having ratification from Venezuela and Uruguay it still needs ratification from Argentina, Brazil, and Paraguay, who have expressed unofficial acceptance. Once officially approved as a full member, it will be given 4 years to get its laws compatible with Mercosur’s regulations. Bolivia began acceding into Mercosur as a full member in December 2012 and has been an associate member since 1997.

The Pacific Alliance held meetings June 19-20, 2014 in Punta Mita, Mexico. The 4 founding countries and 32 observers were in attendance. A variety of trade issues were discussed, as well as a desire to create stronger ties with Mercosur. Brazil, Paraguay, and Uruguay have also expressed interest in joining the Pacific Alliance amidst lots of talk and controversy between Uruguay, Chile, and other Mercosur members. According to reports, Argentina stands to gain the most with stronger ties with Asia. The Pacific Alliance is a trade block consisting of Chile, Colombia, Mexico, and Peru formed in 2011. Costa Rica is currently in the process of joining.

Argentina is ranked 8th in world broiler meat production behind the US, China, Brazil, EU, India, Mexico, and Russia. Broiler meat production in Argentina is projected to reach 2.1 million metric tons (MMT) in 2014 (+3.8%) and 2.022 MMT in 2013 due to continued export market expansion. Domestic consumption seems to have reached its ceiling with per capita consumption expected to remain stable at 40 kg. Imports are predicted to decline to 2,000 MT in 2014 due to the strong import restriction system imposed by Argentina’s Government. Yet total Argentine broiler meat exports, excluding chicken paws, are expected to reach a record 355,000 MT in 2014. Total exports, excluding paws, are estimated at 323,000 MT in 2013. Venezuela continues to be Argentina’s largest export market, representing 45% of total exports. Exports of paws are estimated to be stable in 2014 at 34,000 MT. Argentine paw exports were 17,000 MT in the first semester of 2013. The main markets for paws are China and Hong Kong.

Sources: News Wires/USDA FAS Gain Report September 4, 2013

Total Mercosur Broiler Meat Exports by Member Country and Volume in Thousand Metric Tons (TMT)
Note: All data is January-December except for 2014*, which only includes exports from January-May 2014 for Brazil and January-April 2014 for Argentina, Uruguay, and Paraguay.

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