Meat dispute leads to higher prices

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By Candace Piette BBC News, Buenos Aires

Price rises on many basic foods in Argentina appear to have frozen over the past year following government price controls.

Prices paid at Liniers market set the level for all meat sold in the country

But despite these controls, the BBC food price index is registering a rise of around 19% and the increase has mostly been due to the rise in meat and milk prices.

There has been a lot of criticism from cattle ranchers and farmers who say the government forces them to sell their cattle at unrealistic prices.

On the outskirts of Buenos Aires lies the Liniers cattle market and outside its high walls, trucks from all over the country park up to unload their cargoes.

The cattle are pushed up ramps and into fenced corrals inside, and then they are auctioned off to the slaughter houses and meat packing plants.

This is the biggest cattle market in the world, with some 40,000 animals coming through the gates every week.

Special status

Beef is revered in Argentina and all products related to it, including milk, are regarded as staple foods and no Argentine will do without a traditional Sunday barbecue.

So when in 2006 prices began to rise, the government introduced price controls.

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For the past two years ranchers have been forced to send a higher percentage of cows to slaughter at the meat market.

They say this is partly because of a serious drought but it is mostly because the price the government is allowing them to charge for the animals is so low.

They say they cannot afford to feed the mothers and their calves.

"It is all down to government mishandling," says Nestor Roulet, vice president of the Rural Confederations of Argentina.

"The government has the wrong hypothesis, they think that if the price of bulls or heifers on the hoof is kept down that this means meat will be cheap in the shops," he says.

Mr Roulet maintains that the government has the same attitude towards milk, whereby if the milk is cheap at the dairy it will be cheap in the supermarkets.

"But the government is allowing the intermediaries to benefit. The producers only get 20% of the profit, the other 80% is divided out between industry, commerce and the state," he says.

Policy backfires

Mr Roulet says the Argentine herd is now so depleted that the country will have to import beef from neighbours by 2011.

People do not know how to have a meal which is not centred around meat Alan Cibils, General Sarmiento University

Furthermore, there is no reliable unbiased data on what is really happening to prices.

The government took over the running of the national statistics agency a few years ago and critics say the agency tends to talk down bad news.

With no reliable benchmarks, consumers are charged more says Mr Roulet.

"The government has set up a reference system for prices. They pay the producer 70 cents for a cheese and say it should be 20 pesos in the shops.

The government has lost its majority in Congress because of food price hikes

"But it is a lie, independent figures say they are actually 40 pesos in the supermarket. It's very damaging, producers get almost nothing, and consumers pay more."

The government's price controls were intended to protect the consumer not punish them says Alan Cibils of the General Sarmiento University in Buenos Aires

"People here don't know how to have a meal which is not centred around some form of meat," he says.

The price control strategy intended to appeal to ordinary voters appears not to have worked. In June mid-term elections the government lost its majority in congress and the discontent with price rises is palpable on the streets.

For the first time ever, Argentines are facing a shocking future whereby they might not be able to afford to eat home-grown beef at all.

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