“The Argentine cattle herd has fallen dramatically from 58 million head in 2007 to 48 million in 2011, a 20 percent drop,” said Maldonado.

Furthermore, the 180 percent increase in consumer prices since 2009 has also been a crucial reason for the 22.4 percent drop in per capita consumption of beef.

In the first half of 2010, Argentines ceased to be the world’s main consumers of beef when they were overtaken by Uruguay with an average per capita consumption of 128 pounds, according to the Uruguayan National Meat Institute.

In Argentina, soybeans have become the predominant harvest, displacing not only cattle but other traditional grains such as wheat and corn. Argentina has become the world’s third-largest exporter of soybeans behind the U.S. and Brazil.

Australia
Elevated currencies, global economic uncertainty and climate risks might be posing short-term obstacles for global beef markets; however, the longer-term outlook remains bullish according to a recently released industry report, the Rabobank Beef Quarterly.

Australian markets will also feel some ongoing pressure through to the first quarter of 2012; however. a number of factors should provide support for prices in the second half of next year, the report said.

One key factor will be the reduction in the cattle herd due to the severe drought taking place across the U.S., which is a key competitor in Australian beef export markets.

The Australian live export market looks strong with the potential to reach record prices this quarter. Through to the first quarter of 2012, Rabobank expects an increase in global beef competitor meat supplies.

This will take place amidst a backdrop of uncertain economic growth. However, cattle prices are likely to reach record highs later next year as markets transition from a short-term supply bulge – primarily in the U.S. where herds are diminishing due to drought – to materially lower supplies.

Report co-author Wendy Voss said the longer-term view is that global meat protein supplies will continue to lag income and population growth in important emerging markets.

“This places pressure on supply, increasing prices throughout the supply chain, from feeder cattle buyers, processors and all the way through to consumers,” Voss said.

Brazil
The stronger Brazilian real in relation to the dollar has made Brazilian beef a little less competitive overseas and U.S. cattle country is one of its benefactors of that exchange rate.

According to Brazil’s beef exporters association, Abiec, Brazil exported 672,600 metric tons of beef to world markets between January and July, while U.S. beef exporters shipped 741,300 metric tons, bringing in $3.06 billion to Brazil’s $3.01 billion.

It’s the first time the U.S. has beat out Brazil in the global beef market since 2003. Brazil is one of the world’s leading breadbasket nations, much like the U.S. It is the second-largest soybean exporter after the U.S., and the world’s largest poultry, sugar and orange juice exporter.

The U.S. is managing to gain access to markets now that were closed because of price, such as Europe and Egypt, explains Abiec’s executive director Fernando Sampaio.

Sampaio said U.S. cattle country and beef exporters shouldn’t get too cozy at the top. “It’s unlikely to last,” Sampaio said. “Not only is the Brazilian real weakening, the long- term commodity trend in the U.S. is for higher corn prices on account of ethanol production.”

China
PepsiCo, Inc. (NYSE: PEP) announced recently that it has signed a memorandum of understanding with the Ministry of Agriculture of the People’s Republic of China to promote sustainable agriculture projects and accelerate the development of rural China.

As part of the joint initiative, PepsiCo and the Ministry of Agriculture will build and operate demonstration farms that leverage the most advanced irrigation, fertilization and crop management techniques.

They also will collaborate to promote best practices across China’s farming system to improve yields, increase income levels and raise living standards for farmers throughout the country.

The partnership continues PepsiCo’s focus on investing in sustainable agriculture development projects in China and demonstrates the company’s continued support for China’s 12th five-year plan.

PepsiCo is one of the largest agricultural enterprises in the world, growing and using more than 4 million tons of potatoes for its Frito-Lay snacks, 600,000 tons of oats for its Quaker food products and 3 million tons of oranges and other fruits and vegetables for its Tropicana and other juice brands every year.

Tim Minges, chairman of PepsiCo’s Greater China Region, said, “PepsiCo takes great pride in creating tailored approaches to business investment that achieve both commercial and social objectives.”

He said his company’s success in promoting sustainable agriculture programs in China and around the world is a “great example of its ability to drive PepsiCo’s performance while also improving the communities in which we do business.”

PepsiCo investments in China’s agricultural sector are part of a global strategy to make the company a leader in sustainable agricultural around the world. Recent examples include:

• A partnership with the Inter-American Development Bank (IDB) to promote sunflower farming in northern Mexico.

• A partnership with Cambridge University in the UK to develop an innovative web-based crop management system that provides farmers with real-time data on crop performance.

• The promotion of advanced irrigation techniques in India that saved 200 million liters of water in 2010.

• The creation of the Agricultural Development Center of Peru, a global center of excellence for PepsiCo focused on the cultivation of potatoes and other tubers and roots. 

Clint Peck is the owner of Global Beef Systems, LLC.