Paraguay faces a worsening crisis in its fragile agriculture and livestock sector as mounting losses from a foot-and-mouth disease outbreak threaten to decimate exports and make thousands jobless.

Financial losses exceed $300 million and are on the rise, official figures showed. More than 5,000 farm workers who lost their livelihoods have nowhere to go and have little community or industry support.

More than 1,200 cattle had to be destroyed and the culling was unlikely to stop until government veterinary officials could be sure the outbreak was under control.

The foot-and-mouth disease is highly contagious and strikes mainly cattle and swine but also sheep and goats.

Hundreds of Paraguayan trucks carrying livestock products faced border closures in Argentina, Bolivia and Brazil and Chilean customs turned away food merchandise from the landlocked country.

The disease outbreak is a major blow to Paraguay, which has been suffering from several months of a border row with Argentina that caused its exports to be stopped in that country. Paraguay also suffered a setback in its efforts to export electricity to Uruguay after Argentina upped transit fees for the use of its power grid.

Meat Chamber President Luis Pettengill said worst hit were the workers in the country's abattoirs, estimated to be at least 5,000 but the effect of the crisis was felt in other sectors as well. Industry analysts said the haulage companies would be among those to be seriously hit by a downturn in their business.

The challenge for the government of President Fernando Lugo was to control the outbreak and activate basic support for those being deprived of their livelihoods.

Pettengill warned the crisis would be long-drawn.

"In the best of circumstances the stoppage of the meat industry will be at least 90 days," he said. "There might be some marginal export market still open but you will see ten abattoirs competing for that minimum portion."

The Meat Chamber has been coordinating measures with government animal health services to minimize the impact of the outbreak on agriculture and livestock industries, meat processors and other connected industries.

The industry expects to shrink considerably as a result of the crisis, with hundreds losing jobs and meat and other commodity prices crashing as a result.

Officials say the industry estimates of $300 million losses may be conservative as the effect of the outbreak spreads across the economy.

They are hoping the crisis may prompt Argentina to relent and agree to charge the landlocked nation's traders lower transit fees -- a continuing point of dispute between the two countries.

Argentina's veterinary health officials declared a "state of sanitary alert" and intensified controls at Paraguay border crossings. An Argentine Official Gazette announcement said the alert will affect "the whole national territory due the foot-and-mouth disease outbreak" in Paraguay.

Paraguay is also hoping to negotiate with Chile about another 180 refrigerated trucks with an estimated 4,500 tons of beef intercepted at that country's border even though the beef was dispatched at least three weeks before the reported outbreak.

Related Links
Farming Today - Suppliers and Technology

Tweet