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W51: Weekly Beef Update

Updated Dec 29, 2022
Tridge's global market analysts and country representatives take a deep dive into what happened during W51 in the global beef landscape. In Brazil, with record numbers transported in Q3 of 2022, Mato Grosso continued to rank among the top exporting states for beef. Cattle will be more available in Australia because of the growth in herds and the possibility of a drier second half of the year. Additionally, in New Zealand, the Meat Industry Association (MIA) report shows that lamb and beef exports to Italy surged dramatically, with a 244% rise in red meat exports in October 2022. Over the past 10 months of 2022, UK beef exports increased by 26% YoY, and imports declined by 1.3% YoY. Lastly, South African domestic beef cut prices increased in November 2022 compared to November 2021.


Beef Exports from Mato Grosso Increased by 37% in 2022

With record numbers transported in Q3 of 2022, Mato Grosso continued to rank among the top exporting states for beef. Due to the successful Q3 2022, there was a 37.85% YoY rise in export volume from January to November 2022. A total of 50,800MT of the carcass were exported in just the month of November. China and Hong Kong account for 66.3% of shipments. Recent months have seen pressure from China on the price paid for Brazilian beef, which resulted in a 38.7% reduction in revenues in November, amounting to USD 134.94M.

Meat Export Performance in the First Three Weeks of December in Brazil

Both beef and pork shipments are increasing, with pork showing the strongest relative performance. Its export volume is over a third higher than it was a year ago. In comparison, the volume of beef shipped has increased by nearly 24% YoY, and the average price of beef is just 3.32% higher than that recorded in December of 2021.

With Foot-And-Mouth Disease Vaccination, Minas Gerais in Brazil Seeks Worldwide Recognition

The Minas Gerais immunization drive against foot-and-mouth disease has ten days left to go. As of December, the state has immunized 22.2M heads or 88.6% of the vaccination coverage rate. The next stage will be to apply for global recognition from the World Organization for Animal Health (WHO) for a region free of the disease without vaccination after the cycle has ended throughout Minas Gerais. The objective is to get 95% coverage, or 25M cattle and buffaloes.

Brazilian Market Share in Chinese Beef Imports Reaches Around 40% In the First 11 Months of 2022

China is the largest global importer of beef, accounting for more than 30% of the world demand for imports of this protein. In 2022, approximately 2.49M MT of beef were unloaded at Chinese ports, of which around 987K MT were produced and shipped from Brazil, equivalent to 39.7% of the total imports. Even with several issues primarily related to the COVID-19 outbreaks, China has already imported the most beef in its history before the outcome of December 2022 is taken into account.

United States

Inflationary Challenges Impacting US Retail Beef Prices

Although retail beef prices are down from 2021, they are still historically higher due to the impact of inflation on the US economy and the anticipated reduction in cow numbers by 2023. Customers are switching to less expensive goods. For instance, they might buy more ground beef or lower-priced steaks instead of ribeye cuts. The demand for beef is still strong overall, and people are still buying it. That is one of the reasons retail prices have stayed high because people are still buying. In 2023, the overall US cow herd is expected to see a 3% reduction YoY.


Australian Beef Cattle Is on the Rise Again

Cattle will be more available in Australia because of the growth in herds. Australia began butchering cattle in 2022 with 72,477 cattle per week. The 100K slaughters per week were exceeded only three times in July and August. However, in the last week of November, 105,093 cattle were slaughtered, the highest number in 2022.

In Australia the Herd Recovers Thanks to Rains Brought by la Niña

While La Niña has caused historic droughts in the United States, the rainfall it brought to Australia was advantageous for the livestock industry. The rains in the oceanic nation have made food more readily available, preventing animal deaths and the dispersal of the herd. The unprecedented droughts that caused herd elimination in the US in 2022 will be highlighted. Between 2018 and 2022, the northern country's cattle inventory fell by about 3M heads, falling to 29.6M in 2022. In 2023, US production will decline by 3%, or 400-500K MT annually. The United States will turn to the international market to close this imbalance through imports, expanding the opportunity for other countries, including Australia, to export. Additionally, Australian farmers would experience a distinct situation in 2023 since they had never faced La Niña for four years in a row.

New Zealand

New Zealand’s Red Meat Exports Increased in October 2022

The New Zealand Meat Industry Association (MIA) report shows that lamb and beef exports to Italy surged dramatically, with a 244% rise in red meat exports in October 2022 compared to October 2021. New Zealand's red meat exports were valued at USD 737M in October 2022, a 6% increase YoY, when exports to China reached USD 290M, followed by the United States at USD 134M, Japan at USD 32M, and Italy at USD 26M. Additionally, exports to Canada rose by 82% YoY to USD 22M. When compared to October 2021, the amount of beef exported, which totaled 27,505MT, was nearly identical. However, the value of those exports, primarily to China, climbed by 19% YoY.


China Continues Beef Demand From Uruguay in W51, Projecting the Post-New Year

The Chinese market sustained its activity for beef businesses, projecting the replacement of post-New Year stocks, thus confirming the recovery of buying interest that began in W50. In the beef import market, sales were made from Uruguay of forequarters at USD 4,900/ton and shin & shank at USD 6,900/ton CFR PRC. Additionally, knuckle at USD 5,200-5,400/ton CFR, eye round at USD 6,100-6,300/ton, incomplete forequarter 90 VL at USD 4,200/ton CFR, blade oyster – chuck tender USD 5,500/ton CFR and chuck roll neck at USD 4,500/ton CFR.

Uruguay’s Live Cattle Exports in the First 11 Months Fell by 65.9% YoY

According to data supplied by the Uruguayan National Meat Institute (INAC), from January to November 2022, a total of 62K live cattle were exported from Uruguay, a decline of 65.9% YoY.

United Kingdom

November Beef Production at the Highest Level in 2022

The UK produced 84,100MT of beef and veal in November, up 3.1% MoM and 6.1% YoY. Prime cattle slaughter stood at 177,600 head, up 2.6% MoM, and 5.2% YoY. For the seventh consecutive month, average carcass weights decreased marginally to 340.7kg on average. This is a 0.5% YoY and 0.1% MoM decrease. The number of cows slaughtered stood at 74,100, the highest monthly cow throughput since November 2016. This reflects a 5.1% MoM and an 11.4% YoY increase.

Farmers Urge Actions as the Cost of Bovine Tuberculosis Is Soaring in Northern Ireland, UK

The Northern Irish government has been urged by the Ulster Farmers' Union (UFU) to quickly put the updated bTB eradication strategy into action. The price of bTB has gone up during the past ten years. The UFU estimates that by April 2023, the taxpayer will have paid an additional USD 18.17M. At the end of October 2022, the herd incidence level for bovine TB had reached 9.95%.


Beef, High Costs for Farmers and Declining Consumption Affected by Inflation in Italy

In Italy, high costs for beef production are not offset by price rises, ranging from feed to energy, which has climbed quickly and has been a pain in the side for many months (which has also given the sector some relief). However, purchases in Italy, at least those with wide distribution, are declining. The main reason for this is inflation, which forces families to choose less expensive options. However, as time goes on, other factors include changes in dietary preferences, competition from plant-based protein products, and the looming threat of "test-tube meat," which has just cleared customs in the USA.


Alarm in Beef Exports Due to the Persistent Downward Trend in International Prices

Argentina's exporting refrigerators are on full alert because of the decline in global bovine meat prices towards the end of this year. The average export price for chilled and frozen beef dropped 16.9% in November 2022. This kind of problem keeps the export industry on guard because, as stated in a statement by the aforementioned organization, the primary destinations for Argentine meat have been seeing a declining trend in meat prices since last May. The survey also showed that the amount sold to the world in November was 52,400MT by product weight, 2.2% less MoM and that sales were USD 219.3M, an 18.7% decrease in monthly revenues.

Drought in Argentina Affected Livestock Production, Jeopardizing Beef Supply for 2023

A decreased supply of beef is anticipated for 2023 as a result of the drought that threatened animal production in Argentina. More animals are being slaughtered in W51. However, the drought has not created favourable conditions to increase production. By November 2022, 12.26M animals had been slaughtered, and by December, it was almost 13.5M. It is anticipated that the yearly slaughter in 2022 will be greater than 25% of the 53.4M cattle that were registered at the start of the cycle, or as of December 31, 2021.

In 2023, Export Meat Prices in Argentina Would Be Between 30-40% Lower

Prices in the primary export meat destinations fell dramatically in the second part of the year, presenting a difficult environment for the beef sector in 2023. Competitiveness will be the industry's largest obstacle to overcome the following year. The record prices of more than USD 17K/MT that European importers paid in the middle of the first half of 2022 are long gone. The actual pricing range for the first few months of 2023 is between 30-40% lower. The traditional refrigeration industry had to contend with competition from operators without a plant who enter the market when prices are high and exit it when prices are low during the high-price months in the Chinese market.

The Cattle Ranch Slaughter in Argentina Grew Again in November Due to the Drought and the Drop in the Price of Meat

The cattle ranch slaughter grew in November and celebrated four months of growth due to the catastrophic drought that is affecting Argentina and the decline in the price of meat on the counters of the major global markets. 1.16M cow heads were slaughtered in November, up 0.5% MoM and 4.7% YoY. When compared to the previous month, the percentage of female cows that were slaughtered rose to 44.2%, although it was still within the range necessary to maintain the herd of cattle. The American market would benefit from the reduced demand for canned cows brought on by the decline in Chinese demand since it needs low-quality meat for industrial processing. 12.3M were slaughtered between January and November 2022, 3.5% more than in the first eleven months of 2021.

South Africa

The Price of South African Beef Increased in November 2022, Compared to the Same Period in 2021

South African domestic beef cut prices increased in November 2022 compared to November 2021. Prices for beef rump steak increased 0.37% YoY, from USD 9.787/kg in November 2021 to USD 9.823/kg in November 2022. Beef brisket increased by 11.84% YoY from USD 5.673/kg to USD 6.345/kg, followed by beef chuck, which increased by 10.38% YoY from USD 5.827/kg to USD 6.432/kg. Beef t-bone prices increased by 18.46% YoY, from USD 6.728/kg to USD 7.969/kg.


The Turkish General Directory of Meat and Milk Board to Import 1K MT of Boneless Beef From Bosnia and Herzegovina

Earlier this year, Turkish producers suffered losses because of the low carcass prices, which occurred despite rising animal feed costs, and this resulted in the emptying of the fattening farms. However, as of W51, carcass slaughter prices increased rapidly, from an average of USD 5.5/kg to USD 6.5/kg in W50. The General Directory of Meat and Milk Board (IHC) was unable to find any slaughtered animals due to the low availability of animals and the rise in carcass slaughter prices.

Therefore, within the framework of the Free Trade Agreement, IHC has begun the process of importing 1K MT of boneless beef from Bosnia and Herzegovina for USD 7.65/kg. From the start of 2022-present, IHC imported only 400MT of boneless meat from Bosnia and Herzegovina for USD 7.44/kg. Additionally, in 2021, boneless meat was imported from Bosnia and Herzegovina for USD 5.42/kg. The current import price indicates a 41% increase over last year’s import price.


In November, the Price of Beef in Ukraine Fell by 1.4%

The average consumer price for beef dropped to USD 5.42/kg in November 2022 from USD 5.50/kg, a 1.4% decrease MoM. As compared with January 2022, the average consumer price of beef increased by 2.6% from UAH 195.61/kg in January.

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