On Monday Paraguayan daily La Nación reported that the country has exported a record 400,000 tons of beef this year, double that of 2011. And beyond increasing quantity, the industry has added more value — export volume increased 55% from June 2013 to June 2015, while value rose 70% to $1.3 billion over the same time. By 2018, Paraguay aims to increase its beef exports to 600,000 tons, thus displacing New Zealand as the world’s fifth-largest beef exporter. This will be possible because the country has the lowest cost-per-kilogram of beef production out of all the major players: $0.90 compared to the E.U.’s $2.50, the U.S.’s $1.90, Australia’s $1.80, Argentina’s $1.60, Uruguay’s $1.40, and Brazil’s $1.30.
Given the structural capacities of Paraguay, this level (which would reach 830,000 tons when beef for domestic consumption is included) would be the maximum that the country can aspire to reach, according to Dr. Marcos Medina, Vice-minister of Livestock. However prosperous for the economy it would be, the planned expansion of the beef industry from the current 12-14 million head of cattle to 20 million by 2020 will mean more deforestation, already a major problem in the country. Cattle herd growth is mainly in the forested northern half of the country known as the Chaco region, where there is less competition from crops for agricultural land. (Processing companies are also investing in packing plants closer to the cattle.) According to data from the NGO Global Forest Watch, between 2001 and 2012 the Alto Paraguay region (including the Chaco) lost a staggering 977,125 hectares of tree cover — nearly 14% of its forests.
Deforestation particularly harms indigenous peoples in Paraguay, who are in a “state of emergency,” according to the U.N.’s Special Rapporteur for indigenous peoples. Its recent report found “persistent racism,” “discrimination,” and a total failure by the Paraguayan state to uphold indigenous peoples’ land rights. Paraguayan land rights claims are further complicated by an out-of-date and inaccurate landholding state registry, said Jonathan Mazower, Advocacy Director of the human rights NGO Survival International. As a result, land ownership is unclear and firms often claim ownership of land that had already been legally turned over to Ayoreo Indians. The U.N. report underscores “massive deforestation” of Ayoreo land and warns that the government’s failure to return the land to its rightful owners places Ayoreo lives in great danger. Cattle firms, particularly Yaguareté Porã SA and Spanish-owned Carlos Casado SA, have already destroyed much of the Ayoreo forest, which is suffering the highest deforestation rate in the world.
It remains to be seen whether indigenous concerns will slow down Paraguay’s charging beef industry even slightly.