Building a “country strategy”

Last Thursday, June 2, Rel-UITA (IUF Latin America) participated in the Uruguayan Meat Industry Forum organized by the Parliamentary Industry Committee and the National Meat Institute (INAC) under the slogan “Different views, a single national vision.” The event was held in the Legislative Palace in Montevideo and constituted an initiative unprecedented in the country, convening as it did all of the sector’s stakeholders to gather their views of the present and their vision for the future.

The Forum began on a high note, with the presence of Uruguayan President José Mujica and his ministers of industry, labor, and cattle-raising, agriculture and fishery, as well as representatives of the national confederation of workers, PIT-CNT, and business operators from the cattle and meat sectors.

The president opened the event remarking that, “If we had to define what it means to be a Uruguayan, we’d have to describe ourselves, a little jokingly, as a somewhat peculiar tick, because we’ve been living off cows for years.”

“This is a key activity for our country,” he continued. “It is enormously stable and has shown a formidable resilience in the face of adverse conditions.”

“Nonetheless, there are many things that need to be improved. Most importantly, producers need to take on a more dynamic role, and not just settle for what they already have.”

“The problems faced by the meat industry transcend the sector; they’re ‘country issues.’ But our predominant culture does not allow us to realize that this is at the core of our existence.

“So I applaud the national parliament for their great intellectual stature in promoting gatherings like this, which send a positive message to the country.”

“I’m looking forward to the conclusions that will come out of your work here today,” Mujica concluded.

IUF Latin America was represented by, among others, Alberto Fantini and Carlos Molinares, respectively general secretary and organization secretary of Argentina’s Labor Federation of Meat and Meat Byproduct Industry Workers.

Argentina

Concern for the sector’s future

Consulted about the Forum by Sirel, Fantini described the initiative as “quite interesting,” and said it had “received support from Uruguay’s highest political spheres.”

“We hope that Uruguay doesn’t make the same mistakes that were made in Argentina,” he continued, “where meat prices in the domestic market were lowered at the expense of a great many jobs. In all 7,000 workers have been laid off. At first it was due to a very prolonged drought that severely affected cattle stocks. But it was also due to restrictions placed on exports as a means of regulating domestic prices.”

“And let’s not forget the expansion of soybean crops, which have significantly impacted our sector, as it is a much more cost-efficient production than cattle raising, because of its much shorter cycle. From the presentations we’ve seen here, it seems that this is starting to happen in Uruguay too. The country’s traditional 70 million heads of cattle has been reduced to 60 million.”

“We want to use these spaces to share our experience,” Fantini continued, “because Argentina has also seen an overwhelming influx of foreign investment, in particular from Brazil, with a different agenda.”

“Right now, we have 17 plants closed down, 7,000 applications for unemployment insurance, and plants operating for only two or three hours a day instead of eight.”

“We’re worried about wages and working conditions, but especially about what the future holds for Argentina’s meatpacking industries.”

“This reinforces our conviction that the path taken by our organizations in the IUF, with the decision to build a Coordinating Body of Mercosur Meat Industry Workers, is a smart strategy,” he stressed.

“When workers come together, when we unite, we can rely on solidarity to solve our problems and we can concentrate our efforts.”

“Companies have concentrated their efforts, and we need to do the same: unite, coordinate, discuss and share information. As Perón used to say: Together we’re worth much more,” Fantini concluded.

A booming poultry sector

Carlos Molinares, for his part, said, “In Argentina we’re witnessing major job losses in the bovine sector, while, on the other hand, there’s a very strong increase in employment in the poultry sector, with a steady upward trend from 2003 to date.”

“This occurs because Argentine poultry producers have followed market trends through accurate projections based on reality, using them to their advantage. The number of animals slaughtered has grown at an annual rate of 10 percent and this rate is expected to continue at least until 2013.”

“That translates into great stability for us in this sector; and in addition to obtaining good wages through bargaining, we’ve obtained historical gains, such as retirement at 50 years of age for men and 55 for women,” Molinares noted.

“In the poultry sector, the investment is of national origin, while in the bovine sector it is mostly foreign, with JBS or Marfrig and other companies, which ironically have kept many of the plants they’ve purchased closed.”

“One thing we want to highlight in particular,” Molinares said, “is that organizing this Forum was a very good idea, as it was an opportunity to hear and share views from all of the sector’s stakeholders, and to discuss together what we want for the future. That’s a very positive thing, and it’s something that in Argentina, for example, has never been done, because domestic political agendas have stood in the way.”

“I think Uruguayan workers should follow all of these matters closely, because global demand for food will continue to pressure the meat sector, but also because products such as soybean, corn, etc., are competing for the same farmland as cattle, and maintaining an adequate balance in land use will be crucial,” he concluded.

Uruguay

Better distribution

and more jobs

Ariel Yakes, president of the Federation of Meat and Related Industry Workers (FOICA), said that while these are happy days “for those who benefit from the boom in international meat prices, working families are not doing so great.”

“Sales per employee grew by 11 percent from 2007 to 2010. In January 2007 the value added by the industry to an average heifer was US$ 144, and today that value added is as high as US$ 214. In that same period of time exports also rose significantly, both in US dollars and in Uruguayan pesos.”

“This growth should have been accompanied by a just distribution of income. In 2000, the incidence of wages in the sector’s GDP was 53 percent, and in 2007, the last year for which statistics are available, it was down to 37 percent.”

“We’re concerned over the increasing concentration and foreign investment in the industry and the sector,” Yakes said.

“For industrialists, having an idle capacity –which is now about 30 percent– is not so much a problem as it is strategy for greater accumulation and centralization.”

“The answer that cattle ranchers have found to defend their interests in the face of such a concentrated industry is exporting live cattle. But some serious mistakes have been committed, like the sale of thousands of heads of cattle to Turkey, which offers its cattle ranchers large subsidies to replenish stocks.”

“Turkey offered its producers a subsidy to import live cattle, which in Uruguay resulted in a 50 percent increase over the price offered by the domestic industry. Then everyone wanted to sell their cattle to Turkey. But, what do we do if tomorrow Russia, who’s our main buyer, comes to us and says it wants to buy all the cattle live? Are we going to do it? Do we finish the local industry off?” the FOICA leader said.

In response to comments by a meatpacking industry representative, Yakes noted that wage differences with other Mercosur countries “are not as significant as is claimed by business, who uses extreme examples that are actually exceptions to the rule. A deboner, for example, earns at most US$ 600 a month, and business claims they are paid US$ 2,000 a month, after taxes.”

“We want to conduct an in-depth analysis of these issues, which will be useful for the country, not just for us, the 11,000 workers in the meat industry. Business needs to be well aware that there is another side to this boom, to these favorable prices, and that other side is the 3,000 workers on unemployment insurance.”

“When conditions are bad, we all lose; but when there’s a boom, only they win, and that’s not right,” he sentenced.

Yakes posed the need to set up a Sectorial Group “to discuss all these issues, to reach consensual solutions, and act together based on agreements with a national vision.”

“We have the example of what’s happening in Argentina, and we’re still in time here to take another path.”

“This Forum will be a great success even if the only outcome is a clear expression of will to begin discussions to coordinate actions,” Yakes concluded.

For his part, congressman Felipe Carballo, the Forum’s leading promoter, closed the event saying, “This has been a very rich, diverse and open instance, in which every stakeholder presented what they considered to be their leading problems.”

“The public’s response was excellent, perhaps even exceeding our expectations, and that’s a clear sign of the interest that exists in these issue in Uruguayan society.”

“Now, our Industry Committee, which organized the event together with INAC, will have to carefully examine everything that was said here and use it as input to begin drafting proper policies for the sector, and –why not?– build on the will shown by all the stakeholders here and generate a common space for ongoing exchange,” he concluded.