DUGGAN, Argentina (Reuters) – Tipping the scales at more than a tonne, Montecristo would yield a lot of Argentine steak. But ranchers are not interested in sending bulls like him to slaughter because his semen is valuable.
With newly affluent consumers from Brazil to China eating more meat, Argentine ranchers are honing their centuries-old cattle-breeding traditions to meet growing global demand for semen, embryos and genetics know-how.
“We don’t have to pay for advertising. People associate the word Argentina with the word beef,” said Mariano Etcheverry, secretary of CABIA, a group of 20 Argentine bovine genetics companies.
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Aided by the fame of the Argentine steak, breeders say exports to Brazil, Bolivia, Uruguay and Paraguay have surged in recent years as strong economic growth in South America swells the ranks of the middle class. Some have also found new markets in Colombia and Venezuela.
Exports of bovine semen have increased tenfold in the last decade, in part thanks to the devaluation of the peso currency after a 2001-02 economic crisis, Etcheverry said.
But it is China’s interest in bovine genetics that is rousing big hopes among breeders in Argentina, which already sends most of its soybean exports to the Asian giant.
“China is eager to buy Argentine genetics. It has a huge population and demand for meat is booming there,” said Guillermo Garcia, head of Las Lilas Genetica.
Another breeding firm, Don Panos, is also in talks with Chinese investors.
“As well as genetic material, they want the technology – the production technique, so they can do it on their own,” said the company’s head, Carlos Marietti.
At Las Lilas ranch on Argentina’s rolling Pampas plains, 65 breeding bulls graze in individual pens divided by electric fences to stop them from fighting.
During regular “harvests,” workers whisk away the semen of bulls like Montecristo in plastic containers before the animals get the chance to mount the cows paraded before them.
“It’s not dangerous. The bulls are used to it,” Garcia said.
Once the semen has passed quality checks, it is diluted to make up to 300 doses that are kept in liquid nitrogen and sold for around $10 each. Garcia said the price can be higher if the animal has a good breeding record.
“A dose from a Palermo bull can fetch $50,” he said.
Before deciding what semen to buy, breeders examine details of the bulls’ size, weight and estimates of how much feed their calves will need or how tender their meat is likely to be.
Argentine companies still trail their competitors in the United States and Canada in market share, but local breeders say they have carved out a niche among ranchers looking for cattle that yield lean beef on relatively low feed.
Nowhere is the country’s ranching past more evident than at La Rural show.
Breeders strike big money deals and swap expertise.
After paying $15,000 for a prizewinning young bull at the show, Ricardo Smith, who heads bovine genetics firm CIALE, said he had been willing to pay even more, betting on the potential of the unproven stud.
“We’re going to use his genes … but there’s always a risk. He could be good like (former Argentine soccer star) Maradona, or a disappointment,” Smith told a local newspaper.
Argentina was the world’s No. 4 beef supplier in 2009, shipping 653,000 tonnes to markets, including Russia and the European Union.
But for Asian or African nations aiming to add protein-rich food to their diets, importing Argentine beef is pricey. Buying genetics gives them a chance to boost the quality and quantity of beef produced at home at a fraction of the cost.
“Some countries are interested in bovine genetics because providing affordable foodstuff for their citizens has become a priority,” Etcheverry said.
Marietti said his firm is in talks with Ghana and Saudi Arabia, which want bull semen, embryos and know-how as they try to develop a cattle industry based on Argentina’s model.
“There’s a paradox with some countries that have oil, natural gas … but not food,” he said. “Their goal is to achieve food security.”
