LARGE-scale exports of Australian Merino semen and embryos could soon be flowing to Uruguay, mirroring the volume of dairy genetics that regularly cross into Australia from North America.
That’s the word from Pennsylvania-based Ag-Link genetics buyer Pablo Echevarria, who has been contracted by the Uruguayan government to seek sheep genetics to bolster its production capacity.
The trade of Merino genetics to the South American country could ignite a new market for Australian Merino producers into a country that has had its sheep flock halve from 21 million head to below 10 million in recent years.
"The new Uruguayan government is adamant that raising its agricultural production capacity – and specifically sheep and dairy – is key to bringing stability to its farming sector," Mr Echevarria told Rural Press.
He said valuable Uruguayan grazing land had been decimated by soybean plantations and deforestation, but the new President Jose "Pepe" Mujica had made it a goal to boost his countries agricultural sector – its number one export industry - when he was elected in November last year.
Uruguay would attempt to emulate Australia’s more successful Merino operations, which had pushed the boundaries on its wool and meat capacity in recent years, Mr Echevarria said.
"Everyone in the world’ knows that like the best Holstein genetics are in the United States and Canada, the best Merino genetics are in Australia," he said.
The Uruguay agriculture sector contributed 9.8 per cent to the nation's GDP in 2009, compared to the industry sector at 32.8pc and services at 57.4pc.
Trade would be based on a long-term basis in order to build capacity in Uruguay, he added.
The comments came as Mr Echevarria spent a day travelling around Merino studs in the Boorowa, Yass and Harden region and two days at the Great Southern Supreme sheep sale at Canberra with Landmark sheep consultant Stuart Hodgson inspecting Merino sheep and speaking with stud principals.
Mr Echevarria’s interest in buying Australian Merino genetics is one of a few to have taken place during the past six years.
Mr Hodgson said the value Australia’s top Merino genetics could deliver to farmers had opened small trade opportunities with Argentina, Chile, China and Kazakhstan.
"The potential these countries are looking for is to build rural wealth," Mr Hodgson said.
Winyar principal Alan Dawson, Canowindra, NSW, who has in the past sold Merino genetics to Argentina, said Merino producers should look at export markets as a positive step for the wool industry rather than added competition.
"I firmly believe the world may be reaching a point of critical mass in terms of supply of good quality wool," Mr Dawson said.
"We need to have continual supply of quality wool for processors and having other countries producing it will assist."
But stud Merino producers looking to snare a lucrative contract may have to bide their time.
Mr Echevarria said Ag-Link would not be making any purchases until it had the final approval from the Uruguayan government.
The visit comes as Meat and livestock Australia last week report Uruguayan sheep meat exports during 2009 jumped 37pc year-on-year to 25,478 tonnes (shipped weight), its highest volume on record.
Uruguay’s main export market was the Middle East and North Africa (MENA), which accounted for 39pc of total shipments.
Brazil was the second largest market, taking 24pc of the total, followed by China at 8pc.
Uruguay’s increase in exports also coincided with an 18pc lift in slaughter, which reached 2.1 million head in 2009 (INAC).