Insight – Beefed-up opportunities for export to Mexico and Chile
The Mexican and Argentinian governments have announced recent policy changes to beef imports. This may create export opportunities in Mexico and Chile once Australian beef production increases.
Australian exporters should assess the commercial viability of the Mexican and Chilean markets given changed market conditions.
Exporters should also monitor announcements from the Argentinian Government about possible extensions to their beef export restrictions.
Australian beef supplies are now limited because of herd restocking. Exporters are generally looking to supply existing customers as opposed to expanding into new markets.
Mexico: tariff-free quota for beef imports
On 28 June 2021, Mexico announced a 7,000-ton tariff-free quota (TRQ) on beef until 31 December 2021. Under the TRQ, Mexico will import up to 7,000 tons of beef without applying import duties.
The TRQ applies to the following HS codes:
The TRQ is allocated to the first companies that apply. Mexican importers must register for the TRQ using Mexico’s Single Window for Foreign Trade. Registered importers can then apply for direct quota allocations.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership has reduced tariffs on Australian beef exports to Mexico. The tariffs have dropped from 15–20% to 12–15%. Tariffs will continue to decrease each year before reaching 0% in 2027.
In 2020–21, Australia exported $2.9 million of beef and veal to Mexico. The export market peaked at $9.9 million in 2018–19 (Source: ABS 2021).
Argentina: restrictions on beef exports creates opportunities in Chile
On 22 June 2021, Argentina’s government-mandated beef export restriction came into effect. Restrictions are scheduled to conclude on 31 October 2021. However, the Argentinian Government is likely to extend them until 31 December 2021.
Argentina is usually a major beef exporter. The country provided 17% of Chile’s $1.4 billion beef imports in 2020.
Chile’s market is well developed and diverse in terms of demand for quality and price. Australia has agreed conditions in place to export beef to Chile. However, no trade has occurred since 2015. In 2015, Australia exported $1.6 million of beef to Chile. Beef exports to Chile peaked at $95 million in 2012 (as in Figure 1).
Figure 1: Australian beef exports to Chile
The Manual of Importing Country Requirements has import requirements for beef to Chile and Mexico.
Austrade has more information about the Mexican and Chilean markets:
The Australian Government’s network of Agriculture Counsellors provided information for this article. More information about the Agriculture Counsellor network, including contact details, is available on the Department of Agriculture, Water and the Environment website.
Beef market overview
- In 2020, China was the world’s largest importer of beef. The Chinese market was valued at $20 billion (UN Comtrade 2021).
- Between 2016 and 2020, Australia was the second largest exporter of beef. The average market value was $12.7 billion (UN Comtrade 2021).
- Between 2016 and 2020, Chile was the world’s 15th largest importer of beef. Mexico was the 16th largest beef importer (UN Comtrade 2021).