Argentina's Herd to Decline by Up to 1 Million Cattle Due to Drought

Argentina’s herd will shrink by up to 1 million head of cattle next year as ranchers facing scorched pastures after the worst drought in decades decide to slaughter females rather than grow their herds, analysts said.

A wave of hot, dry weather since November has cut 40 percent off overall grains production in the world’s No. 3 corn and soy exporter and will knock off an estimated 0.7 percent from Argentina’s gross domestic product this year.

Slaughtering more female cows than expected will have long-term repercussions on the meat-loving nation’s herd at a time it was hoping to boost sales abroad after falling out of the top 10 beef exporting nations under the previous government.

Ignacio Iriarte, a grain market analyst, said Argentina’s 53.5 million-head herd would shrink by between 500,000 and 1 million head.

“Winter is coming without having planted the grasses normally sown between February and March, which are the ones that provide feed in the middle of the winter,” he said.

“The next five or six months will be critical.”

According to the local beef industry chamber (Ciccra), 44.5 percent of cows slaughtered in March were female, a rate that was 3 percentage points higher than a year earlier.

“This threatens the future offer,” said Miguel Schiaritti, Ciccra’s president. He said the herd had been growing sharply over the last two years, would likely hold steady in 2018 and would decline in 2019.

The U.S. Department of Agriculture said in its latest report Argentina’s herd would shrink this year due to the weather and a larger than normal slaughter.

Pastures have been depleted in one of Argentina’s main cattle producing areas in Chacabuco, in the north of Buenos Aires province, according to Guillermo Voisin, the president of the area’s rural society.

“What is coming is very challenging ... but before the cows get too thin it is better to sell them,” Voisin said.