Rising meat prices double Argentina’s inflation rate in 2025

The livestock sector maintains inventories while international demand grows. Open markets, increased exports, and pressure on supermarket shelves. New INDEC Consumer Price Index: Tariff increases and subsidy cuts will have a greater impact on inflation.

Meat markets face a 2026 year characterized by shortages and a shift in the production cycle. After three years of inventory liquidation, reduced supply—estimated at 200,000 tons—and increased exports to Southeast Asia and Europe will maintain a price trend that will once again exceed projected headline inflation.

Meat prices ended 2025 with a rise of nearly 70%, more than double the rate of inflation. The industry is expected to rise again in 2026, above the CPI, driven by reduced local supply, strong international demand, and the livestock conservation cycle. However, analysts rule out a rise of this magnitude.

Meat prices have risen twice as fast as inflation

“This year’s increase has been 70%, twice the rate of inflation,” noted Andrés Costamagna, director general of the Argentine Society of Agriculture, describing the recent dynamics of meat prices. He explained that this phenomenon is due to a classic market combination: “Demand is increasing, but supply is falling.”

Costamagna emphasized that meat has become a scarce commodity both locally and globally. “After the pandemic, there has been a shift in trends, and protein consumption has increased,” he stated, adding that for many years, the sector “has been under significant pressure from environmentalists,” leading to a decline in the global cattle herd, which currently stands at approximately 920 million head.

Declining Supply: The Impact of the Livestock Cycle in 2026

On the supply side, the diagnosis is the same. In response to a query from Letra P, meat market analyst Victor Tonelli warned that “supply in 2026 and 2027 will be lower than supply in 2023, 2024, and 2025.”

He explained that over the past three years, slaughter volumes have exceeded the equilibrium level, resulting in the loss of more than three million head of cattle, a figure that could reach three and a half million when data for the end of 2025 is available.

Economist Fernando Marull noted the current market price. “An Argentine salary can buy 120 kilograms of cattle per month. The average over the past 30 years has been 190 kilograms. A good price for Argentine cattle. It’s finally paying off,” he wrote.

Tonelli explained that following the October elections and a favorable international price environment, a shift occurred. “What used to be a liquidation cycle has now become a retention cycle,” he noted, referring to producers’ decision to retain cattle for weight gain and calf production.

However, the effect will not be immediate. “The biological cycle of cattle is very slow,” Tonelli emphasized, estimating that annual beef production could decline by approximately 200,000 tonnes in 2026. If exports remain at current levels, this would mean a reduction in the amount of beef available per capita in the domestic market by four to five kilograms, approximately 10% less than in 2025.

Strong demand and exports are putting pressure on prices.

The supply contraction is exacerbated by continued international demand. Costamagna noted that “demand is growing globally, with Southeast Asia leading the way,” and called trade agreements with the United States and the European Union-Mercosur “good news,” although he acknowledged that “they put additional pressure on prices.”

The rural leader emphasized that “when exports increase, Argentines are better off because they have incentives to increase production,” although he added that increasing production requires time and capital. “Increased production doesn’t happen overnight, but the capital invested must be recouped,” he stated.

To mitigate the shortage, the market will be forced to partially resort to imports. Costamagna predicted that “imports from Brazil will continue,” estimating their volume at approximately 160,000 tons. “It will be very small, but it will be enough to cover the shortage,” he explained.

He also warned that when supply fails to meet demand, the market “hedging risks,” especially in conditions where government policies or uncontrolled inflation create obstacles to investment.

Prices, Inflation, and the Macroeconomic Drag

In the short term, meat price movements are driven by persistent inflation. According to the National Institute of Statistics and Census (INDEC), wholesale inflation, which serves as a leading indicator for the CPI, was 2.4% monthly in December and is projected to end 2025 with an annual increase of 26.2%.

Consulting firm LCG noted in its report that wholesale inflation on goods has again fallen below retail inflation, indicating a recovery in profitability. It also warned that the new exchange rate system and wage adjustments could put additional pressure on prices in 2026 in a scenario in which disinflation continues, albeit at a slower pace.

What to Expect in 2026

Against this backdrop, industry forecasts converge on one key point. “Meat prices will rise faster than inflation, but not to the 70% level seen this year,” Costamagna stated, predicting that “prices will correct in 2027.”

Tonelli agreed that with limited supply and very high demand, prices “will keep pace with inflation; they may rise further, but not by much.” He concluded: “Rates of growth like those seen in November and December cannot be sustained.” There are other alternatives that do not justify such an increase.”

Tags: prices, Meat, Argentina