The objective of this paper is to analyse the integration of the international beef market. The dynamic relationships between monthly Argentina export prices and Australian imported beef prices in the USA are modelled for the period 1977-1997 by means of a VECM model. In spite of the traditional segmentation of this market because of “foot and mouth disease”, our results seem to suggest market integration at least in relation with the prices chosen as representatives. However, cointegration between the prices can only be found after including in the model the effect of some changes of the Argentinean economy.

Key words: market integration, law of one price, cointegration, VAR models with error correction mechanism.
JEL classification: C32, F15.