In W42 in the beef landscape, the Paraguayan steer price increased by USD 0.05 to USD 3.35 per kilogram (kg), the third consecutive weekly growth following a seven-week decline. Valor Carne notes that Chile's consistent purchases are reinforcing Paraguayan meatpackers' confidence due to the ongoing supply constraints. In Brazil, steer prices rose by USD 0.04 to USD 3.16/kg, driven by the appreciation of the real, which improved from 5.14 to 5.06 per dollar.
Meanwhile, the Argentine steer price reached USD 4.77/kg in W42, an increase of USD 0.29 compared to W41. However, this might not represent the actual market price due to limited operations, with producers reluctant to sell amidst economic and political uncertainty before the general elections. Uruguay experienced a recomposing market with a reference price of USD 3.05/kg in W42, a rise of USD 0.04 compared to two weeks ago, but remains the lowest in the South American region.
The National Meat Institute (INAC) in Uruguay reports that the Treasury-Export Ratio, a crucial measure linking steer prices and export earnings in Uruguay's livestock industry, declined steadily to 0.808 in W41. This is the lowest level in nearly a decade and significantly below the historical average of 0.934 and the 0.962 recorded in the same period in 2022. This gap has grown from -20% to -29% over the last four weeks. This downward trend stems from a 12% drop in the price per ton of exported meat since Jun-23, coupled with a 25% decrease in fat herd values during the same period. The disparity raises concerns for both producers and the sector. The industry is actively pursuing strategies to restore market balance and stability to address these challenges and ensure the sector's economic health.
The beef carcass market in Spain stagnated in W42, maintaining an equilibrium between supply and demand. The available animal supply adequately matched market requirements, sustaining market stability. Despite active trade both domestically and in European markets, with notable sales to Italy and Greece and continued livestock shipments to Morocco, meat sales were constrained by high prices, failing to mirror recent increases. The cow market encountered challenges characterized by limited sales in Europe and disruptions due to frozen meat stockpiles. Market experts anticipate that the current stability may shift with the onset of colder temperatures, potentially reinvigorating meat consumption despite persistent market uncertainties.
The Polish beef industry expressed concerns about the potential negative impact of martial law in Israel on beef exports, as the country is a significant beef export destination for Poland. The Polish beef sector heavily relies on meat exports, accounting for 70% to 80% of its sales, including to countries that require ritual slaughter. Exports to Israel have provided crucial price support for Polish beef, with sales totaling USD 64.20 million by Jul-23, marked by prices nearly 60% higher than export rates to other countries. While there have been no indications of transport restrictions from Poland to Israel, the industry remains vigilant and maintains open communication with relevant authorities to address any potential issues promptly.
Lastly, Russia's beef production has significantly slowed so far in 2023, with a projected increase of only 1.7% year-on-year (YoY) in live-weight products. This growth is more than two times lower than the average in recent years, primarily attributed to the crisis in the dairy sector, competition from more affordable meat options, and concerns about profitability. These issues have deterred many market players from investing in new projects and have led to extended payback periods. Notably, substantial volumes of duty-free beef imports, totaling 79 thousand metric tons (mt) in the first half of 2023, exacerbate the challenges faced by domestic producers. Industry experts recommend bolstering state support, particularly financial assistance for large beef producers, promoting meat production in small and medium-sized farms, and implementing protective measures against imports to address these issues.