Foreign market pressures decreasing meat export prices in Brazil

Despite Brazil’s strong performance in beef and chicken exports this year, the decline in these product prices in the international market is a point of concern for the animal protein sector.

According to the protein analyst at Safras & Mercado, Fernando Iglesias, although the average prices of chicken are in line with those recorded in 2022, the trend is for further devaluations in the coming months.

“Brazil will maintain global leadership in chicken meat even with sanitary problems. Over the next five to ten years, it seems unlikely that Brazil will lose this leadership. So the problem here is not volume; it’s the average price,” he said during an online event by the consultancy on Wednesday (20/9).

In August, the average price paid for Brazilian chicken meat was $1,872.80 per ton, a 12.24% decrease compared to the same period in 2022 and a 6.3% decrease compared to July.

In total, Brazil exported 3.4 million tonnes of chicken meat from January to August, with revenue of over $6.7 billion. Safras & Mercado’s forecast is that this volume will reach 5 million tons this year, equivalent to one-third of global trade.

The same scenario has been observed in the beef sector, with prices paid by Chinese importers falling from $7,500 per ton last year to $4,500 per ton this year.

“If prices are falling, export revenues are also lower. And that’s one of the reasons why the price of cattle has fallen so much,” Iglesias said.

The chart below shows Brazil’s beef exports from Jan 2019 to Jul 2023. The data used was gathered with the aid of the DataLiner maritime data service.

Brazilian beef exports | Jan 2019 – Jul 2023 | WTMT

Source: DataLiner (click here to request a demo)

Following the devaluation, the Chinese have maintained the same level of payment as other importing markets, which typically pay less for Brazilian beef, he added. The market is expected to recover as a result of Chinese government stimulus measures, including currency depreciation.

“Economic recovery in China is crucial for the formation of beef prices in the international market and, consequently, for cattle,” Iglesias said.

The consultancy predicts that beef exports will amount to 3.3 million tonnes in 2023, a 1.49% decrease compared to last year, still reflecting the Chinese embargo imposed earlier this year.

Source: Globo Rural

Read the original text at: https://globorural.globo.com/cotacoes/noticia/2023/09/precos-das-carnes-brasileiras-seguem-sob-pressao-no-exterior-diz-safras-and-mercado.ghtml

Sharing is caring!