The pulses landscape in Argentina/
An Interview with Ramiro Berraz

Luke Wilkinson spoke to the president, Ramiro Berraz, about the company's beginnings, the trials of Argentina’s fluctuating economy, and how vegetarianism is growing amongst the world’s biggest meat eaters.

How did you get started in the pulses industry?

Well, I have a farm in the north of Argentina in Salta. The farmland was originally bought by a group of Spaniards and Andorrans in 1980 and I started working there around 30 years ago while I was studying. We cleared out the land and started to grow black beans. Things were very different then - the harvest was done by hand -, it was very chaotic. In 2003, financed by a mix of Argentinians and foreigners, we created Legumbres Argentinas in order to spread the risk. We bought huge amounts of product - black beans, cranberry beans - and began exporting to Europe.

We started the company because at that time there were nowhere near as many exporters as there are now, and very few with their own production. I think we were the first to start exporting to Europe - Spain, Italy and Portugal. That would have been around 2005/2006.

Could you give us a picture of Legumbres Argentinas today?

We still have the farm in the north, with the addition of a processing plant. We send a lot of black beans directly to Brazil, especially this year as the price was right and there were issues with international freight to Venezuela and Central America. I have a client in Brazil to whom I send the premium product from the harvest. Fortunately, this year the conditions were good and we had a top quality product.

Last year during the pandemic, we exported a lot to Chile - mainly black beans and chickpeas - as the government had set about distributing pulses. The earlier harvest in Catamarca went to Chile, and the later harvest in Salta went to Brazil. This year, everything went straight to Brazil via truck to avoid problems with the freights.

We export black beans, white beans, chickpeas and lentils but not in such enormous quantities as we used to. We used to have another processing plant in Jújuy and we sent pulses directly to Europe from there. All the processing and packaging was done in the plant and then went directly by train to the ports. Right now, there is the issue with the shipping containers - in the last meeting of La Cámara de Legumbres a month ago it was said that there are 1500 containers of Alubia beans that have been sold but still not shipped. Processing plants are full and you don’t want to send anything to the port in case it gets stuck there and then the costs grow. That's why, nowadays, I prefer to send product directly to Brazil at a lower price, but with less risk that the product gets stuck 1600 km away from the farm.

The Blue Dollar (The black market exchange rate for the US dollar) just moved past the $200 mark. What effect has this had on the pulses trade in Argentina?

It went up to $200 the day before the elections and today it’s still around that, more or less. To give you an idea, I export and they send me the payment for the product in US dollars - I’m then obligated within five days to exchange that into Argentine pesos, at an exchange rate of approximately 100 pesos to the dollar. Then you have the blue dollar, which you can buy at 200 pesos. So, in Argentina where we have problems with devaluation and inflation it’s important for me to buy stock quickly. It’s difficult for exporters to buy stock at the 100 peso rate of exchange because when you talk to the producers they are offering prices closer to the 200 peso exchange rate.

Having these two exchange rates makes things incredibly complicated. There is at least the FOB price estimate given by the government. Without this, people would always choose to price their goods closer to the higher rate.

What effect do you think the high price of soy will have on the seeding for next year in regions like Salta?

When soy has a low price, the smaller farms close to Tucumán, Salta and Jujuy tend to move towards planting beans; more or less whenever they see the price hit $800. If soy does have a high enough price, the farms that are on the fence will tend to move towards that instead of beans because soy is much easier to sow, harvest and sell. With beans you have to have patience, the contacts and the know-how for processing it.

Sometimes it happens that all the conditions are right to sow soy in those regions, in which case they do it, but if there’s suddenly a drought then they’ll switch to beans - almost always black beans, as white beans are even more complicated and people who are not used to growing them can end up with a poor quality harvest.

This year, I think it’s likely that the acreage of soy will be more or less the same as last year. Nothing changes particularly radically. There were moments in the past when soy and corn weren’t profitable due to the price of the freight and withholdings, then people start to look for alternatives like chia, but in the end when the conditions are more or less good and prices are stable everything defaults to the traditional crops.

I see that you have worked with yellow peas - they represent a smaller portion of the market than the green pea. Is there any potential for an increase of yellow peas in Argentina?

We did some tests with yellow peas. Someone came from India to visit us here and travelled up and down the country with the idea of doing in Argentina what they did in Canada by sowing huge amounts around the country and then taking all the harvest back in boats. Just at that moment there were a lot of issues - India had closed imports of chickpeas, here things had changed too and withholdings added up to around 60%, all of which scared us away from the project. In India, they see yellow peas as a product much like soy is here – a product to be grown and then sold in huge quantities at lower prices. It’s nothing like white beans or black beans.

I send a lot of green peas to Brazil, but yellow peas have no market there, nor in Argentina or Chile, so it all goes to India. For now, although anything could happen in the future, I see yellow peas as an extensive crop more than anything. Unless there's a huge jump in the price I don't see its acreage changing.

Could you tell me a little about your motivations for opening a headquarters in India? What possibilities did you see in that market?

Mostly, we saw a huge amount of volume - it’s a country that’s 90% vegetarian and eats a lot of pulses. In the end the problem was the variation of the restrictions of import and export, which do seem quite logical given that they’re such huge producers. If they started importing from other countries at a very low price, they would have economic problems. One issue we had three or four years ago was we sent large quantities of chickpeas to India and suddenly the price dropped and containers full of product were left stuck in Indian ports. After many years of exporting, I started to become a little more conservative and I can't throw away all of our hard work over 20 or 30 containers in India. I simply didn't have the faith in the market I needed in order to export large quantities anymore.

How has the pandemic affected the consumption of pulses in Argentina?

There were big numbers sold during the pandemic. A few things are happening right now in Argentina: firstly, people are eating less and less meat. Argentina has the highest meat consumption per capita in the world but this has dropped a lot in the last 2 years. I see it in my own family - one of my daughters no longer eats meat. In the past, if I brought out a bean salad at one of my barbecues people used to think I was crazy but now they try them, realise they’re delicious and come to the next barbecue! People, particularly the young, are more interested in having healthy diets that include pulses.

There were a lot of lentils, peas and chickpeas eaten last year as the Argentinian government also gave out food packages with pulses to people on low incomes during the pandemic. The influence of the growing population of Venezuelans has meant a rise in black bean consumption as well. I can’t say we’re talking about huge percentages, but compared with 10 or 15 years ago there has been an increase.

Brazilians have eaten more pulses than us for a long time because they know that the protein in a kilo or beans can feed a family for a week and they see all of the nutrients that beans have. Here, on the other hand, we just want meat. Sometimes you give people chickpeas and they’ll throw them in the bin because they want meat instead. There's a lack of education around food - often in the most deprived neighbourhoods.

Are there any movements in Argentina that work to try to educate people with regards to healthy eating?

Yes, there are lots of charities, like the Centro de Estudios Sobre Nutricion Infantil, who we’ve worked with. They help to promote healthy eating from a young age. To give you an idea of the problem, there is a village of 2500 people within the grounds of our farmland, surrounded by 20000 hectares of soybeans, black beans and corn but, despite all that food, there is a problem of malnutrition amongst the villagers. If people don't know how to cook with beans then they won't. It’s a problem of education and its solution should be much more governmental.