Approximately 20% of national meat production is destined for the external market, however, exports are an important outlet for slaughterhouses and contribute to balance in the domestic market.
In May, 120 thousand tons of beef were exported in nature, is the highest volume sold since the beginning of the year. Shipments this month were 10% higher month-on-month and 34% higher year-on-year.
Since the beginning of the year, 567 thousand tons of meat have been destined for the international market, almost 90 thousand tons more compared to the same period last year.
But the recent news of the suspension of exports to China due to the unusual case of mad cow caused confusion in the meat market, as the Asian country is the largest buyer of Brazilian beef.
Since the beginning of 2019, China has purchased 22% of total beef in nature sold by Brazil. Without Chinese demand, many slaughterhouses stopped purchasing, but in any case the meat stock that would have been destined for China is “aimless” in the short term.
Industries with greater storage capacity are doing the math to assess the feasibility of allocating this meat to other destinations, others have gradually begun to sell the meat on the domestic market.
On average for all beef cuts, the devaluation was 0.5% in recent days in wholesale terms. The direction of prices throughout this week will be defined by the possible increase in meat supply. But this effect is likely to be mitigated with the seasonal increase in demand at the beginning of the month.
Post: Marina Carvejani
Author: Marina Zaia
Source: Scot Consulting
