The region of Central and South America typically doesn’t make headlines for beef imports, as most people think first of Brazil as a beef export powerhouse along with Uruguay, Argentina and Paraguay. But other countries in the region are quietly showing the kind of potential that excites U.S. exporters who are able to provide a year-round supply of high-quality, affordable, grain-fed beef. 

At the same time, two of the U.S. beef industry’s main competitors, Argentina and Paraguay, are currently having problems supplying the market – Argentina for its inconsistent export policies, and Paraguay for limitations related to a foot-and-mouth (FMD) disease outbreak.

Currently ranked 12th among the key regions for U.S. beef exports, Central and South America exploded with 53% growth in imports by volume last year and 81% by value – reaching 56.9 million lbs. ($85.5-million value).

While Peru has been the region’s mainstay volume destination for American beef (24.1 million lbs. in 2011), Chile emerged last year as the top value market with 172% growth by volume and 262% growth by value. Chile purchased 9.3 million lbs. of U.S. beef in 2011 at a value of $22.6 million. In just the months of November and December, Chile’s imports of U.S. beef were valued at $7.8 million – more than Chile had ever previously purchased in an entire calendar year.

Chile is the leading market for beef muscle cuts in the region, with chuck roll being the major beef cut exported there. But now, USMEF and U.S. exporters are working to increase the variety of products supplied from the U.S. In Chile, U.S. beef is deepening its penetration in the HRI (hotel, restaurant and institutional) market, and a promotional campaign at supermarkets is helping to enhance demand.

Beef exports to Peru nearly doubled in 2011 vs. 2010, although more than 90% of the volume was offals (mainly tripe and liver). Bovine hearts also are highly regarded in Peru, but it can be challenging to find cleaned hearts for the Peruvian market – a niche that Brazil is currently filling.

Free trade agreements (FTA) made considerable news at the end of 2011, with the Korea-U.S. FTA grabbing most of the headlines. However, the U.S also secured FTAs with Colombia and Panama, inking deals that will fast-track growth of U.S. beef to the region.

Beef exports to Colombia stood at $3.9 million in 2011, double the 2010 export value. Upon implementation, the FTA with Colombia will eliminate the prohibitive 80% duty on many beef items. Importantly, it also will create duty-free access for high-quality (Choice and Prime) beef and a duty-free tariff rate quota for standard beef and beef offals. In addition, over-quota duties will immediately fall from 80% to 50%, then to be reduced to zero over 10 years.

Colombia has a population of nearly 48 million people and the FTA will provide these consumers with growing opportunities to try U.S. beef. The net result is expected to boost U.S. beef exports to Colombia to more than $30 million by the end of this 10-year period.

The FTA with Panama will allow duty-free access for high-quality beef and phase out 30% duties over 15 years for other muscle cuts. In addition, the phase-out of variety meat duties should help boost U.S. beef exports to Panama from $5.17 million in 2011 to more than $9 million over the FTA implementation period. Although Panama’s population is less than 4 million people, its high-end market and booming business travel offer great opportunities for high-quality U.S. beef.