September 15, 2010

Ranchers Selling Semen Instead Of Prized Bull

Ranchers in Argentina are selling the semen of their prize bulls instead of sending them to the slaughter house.

The ranchers are using their centuries-old cattle-breeding traditions to meet the global demand for semen, embryos and genetics.

"We don't have to pay for advertising, people associate the word Argentina with the word beef," Mariano Etcheverry, secretary of CABIA, a chamber that groups around 20 Argentine bovine genetics companies, told Reuters.

Breeders say exports to Brazil, Bolivia, Uruguay and Paraguay have surged in recent years as strong economic growth in South America brings more demand in the middle-class.

Etcheverry told Reuters that exports of bovine semen have increased ten-fold in the last decade, mostly because of the devaluation of the peso currency after a 2001 economic crisis.

However, China's interest in bovine genetics has bought on big hopes among breeders in Argentina, which have sent 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," Guillermo Garcia, head of Las Lilas Genetica, told Reuters.

Don Panos, another breeding firm, is also talking with Chinese investors.

"As well as genetic material, they want the technology -- the production technique, so they can do it on their own," the company's head Carlos Marietti told Reuters.

There are 65 breeding bulls on Argentina's Pampas plains that graze in individual pens divided by electric fences to help stop them from fighting.

Workers whisk away the semen of bulls during regular "harvests" 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 told Reuters.

The semen is diluted to make up to 300 doses kept in liquid nitrogen once it passes quality checks.  Garcia said the $10 price tag could be much higher if the animal has a good breeding record.

"A dose from a Palermo bull can fetch $50," he told Reuters, referring to a prize-winner at the country's largest annual farm show, La Rural.

Breeders examine details of the bulls' size, weight and estimates of how much feed their calves will need before deciding what semen to buy.

Local breeders say that they have carved out a niche among ranchers looking for cattle that yield lean, protein-packed beef on relatively low feed.

Ricardo Smith, who heads Argentina's biggest bovine genetics firm CIALE, said he was willing to pay more than the $15,000 he paid for a prize-winning bull at the La Rural show.

"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 local daily Clarin.

The country was the world's number 4 beef supplier in 2009, shipping 653,000 tons to markets like Russia and the European Union.

However, continents like Asia and Africa focus on genetics to bring protein rich food to their citizens diets because buying importing Argentine beef is pricey.

"Some countries are interested in bovine genetics because providing affordable foodstuff for their citizens has become a priority," Etcheverry told Reuters.

Marietti said his firm is talking with Ghana and Saudi Arabia, which want "the whole package" 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 told Reuters. "Their goal is to achieve food security."