W13: Weekly Beef Update
Live Beef
EU: Veal Calves Should Not Be Isolated in Pens After Birth (Mar 30)
Veal calves should not be kept in individual pens during their first weeks of life in order to improve animal welfare, Reuters reported, citing the EU Food and Safety Authority (EFSA). Instead, they should be housed in pairs or small groups and have sufficient space to rest and play and be provided comfortable bedding, scientists at the EFSA said in a report. A newborn calf is usually removed from his mother immediately or a few hours after birth. Whereas, in nature, they lie together in groups whilst their mothers move off to graze. Every year more than 300M farmed animals spend all or part of their lives in cages, pens, or stalls, according to the advocacy group Compassion in World Farming.
US: Beef Cow, Heifer, and Steer Cattle Slaughter (Mar 29)
Beef cow slaughter, heifer slaughter, and steer slaughter have each begun in 2023 with lower slaughter totals than in 2022. The recent decline in beef cow slaughter is perhaps the most interesting given the large cow slaughter totals seen in 2022. Drought and higher input costs relative to calf prices lead to really high beef cow slaughter in 2022, about 11% above 2023. However, beef cow slaughter has been moderated at the beginning of 2023. Over the first 10 weeks of 2023, beef cow slaughter totaled 683.7K head which is nearly 9% below the first 10 weeks of 2022. Improved drought conditions in many parts of the US and optimism about calf prices are key contributors to fewer cows going to market than a year ago. It is worth noting that beef cow slaughter typically declines seasonally during the first few months of the year.
Australia: Little Incentive to Load up on Live Export (Mar 28)
While the industry is focused on when and how the government plans to phase out live sheep exports, there was little improvement in the cattle live trade in February. Despite a small increase in the January numbers, YTD figures are down significantly, at about 33% fewer cattle sent offshore. It would seem the demand from the southeast Asian markets has been slow to build back up, regardless of Australia’s now lower domestic prices. Live cattle exports to Indonesia did pick up somewhat in February, with close to an extra 4.5K head sold there than in February. However, the February total was still a whopping 62% below the five-year average for the month, which with more than 40% of the market share makes up for much of the total trade dip. According to Meat and Livestock Australia, this brings live cattle numbers sent to Indonesia in the past 12 months 16% lower YoY.
Australia: Cattle Slaughter Expected to Fall in April (Mar 31)
In April 2017, eastern states' kill numbers totaled 430.55K head, and slaughter for 2017 reached 7.16M head. This was 7% (496K head), above the 2023 slaughter forecasts of 6.66M head, suggesting that April 2023’s monthly slaughter will most likely remain below the April totals seen in 2017. In 2022, the weekly average kill rate for the four weeks of April was 83.49K head, a decline of 5% on the preceding four weeks in March. Kill numbers for the first four months of 2022 were significantly impacted by transport access, COVID-19 processing capacity issues, and flooding. However, when looking at April 2017, kill numbers declined by 15% (20K) head, compared to the previous four weeks. During May, average weekly kills rose by 21% (23K head), indicating a significant throughput lift following April’s shortened working period and topping the unimpacted rates prior to the beginning of April. Historical data suggests weekly kill numbers in April 2023 could average around 96K head. This is assuming a 12% decline on the past four weeks’ average. This would total 384K head, which is a rise of 15% on the 333K processed in April 2022. Following the end of April and shortened working weeks, the eastern states' slaughter rates may potentially lift and rise above the current weekly average for 2023 of 96K head, as was the case in 2017.
Australia: Softer Beef Supply Brings a Lift (Mar 31)
Cattle price boards were a welcome shade of green as the market saw minor price recoveries across multiple specifications. Support for the cattle market this week came from reduced supply to the yards and indications that slaughter volumes are remaining solid. On the downside, Brazil’s strengthening relationship with China may pose some stiffer competition for Australian products in the future. The Eastern Young Cattle Indicator (EYCI) halted its downward run and closed the week up 11¢ (2%) to reach 669¢/kg cwt. The usual suspects Roma, Dalby & Dubbo contributed to 55% of the index’s volume, with steers trading at 770¢/kg cwt, 755¢/kg and 695¢/kg respectively, while further south in Wagga, steers moved at 723¢/kg. Rain in southern Queensland and parts of NSW may have provided producers with additional confidence in medium-term pastoral conditions. A pullback on young cattle yarding this week was evident in response as EYCI eligible yarding fell 19% this week down to 12.51K head. The April and May period has historically seen a lower yarding of cattle.
Ireland: New CSO Figures Show Cattle Slaughtering Increase (Mar 28)
The total number of cattle slaughtered in the first two months of the year increased by 2.1% compared to the same period last year, according to the latest figures by the Central Statistics Office, on March 28. However, the data shows that cattle slaughtering were down specifically in February of this year by 2% compared with February 2022 totals.
Ireland: Beef Kill; Prime Cattle Tighten but Cow Supply Remains High (Apr 2)
The first 12 weeks of 2023 have seen just under 395K cattle (excluding veal) slaughtered at Department of Agriculture, Food and the Marine (DAFM) approved factories. This year’s beef kill is running just over 6.2K head of cattle behind last year’s figures. Earlier this year, Bord Bia projected the supply of finished cattle in Ireland to fall by 50-60K head (3-4%) on last year’s levels. The 2022 factory cattle supply was the highest in 23 years. The reduced supply of finished cattle is expected to be seen primarily in the first half of the year and supplies are expected to increase in the second part of the year with extra cattle available in the final quarter of 2023. While prime cattle numbers have tightened in line with Bord Bia forecasts during the first quarter of 2023, there has been a stronger-than-expected cow throughput which has contributed to a higher-than-expected beef kill to date this year.
Ireland: Beef Registrations Down 14K Compared to the Same Period in 2022 (Apr 2)
The number of calf registrations to beef dams is down 14.51K this year when compared to the same period in 2022, based on the latest update from the Irish Cattle Breeding Federation (ICBF). Overall calf registrations are slightly ahead by 10.73K head, with dairy registrations 25.24K head ahead of the same period in 2022. Total calf registrations for the year to date stand at 1.341M head, with 98.13K head added to the total in the last week.
Brazil: Price of Live Cattle Reacts With the Reopening of Exports to China (Mar 27)
In the markets of São Paulo, after the announcement of the resumption of exports to China, the price of cattle and heifers rose by USD 0.39/@ (R$2.00). For the cow, prices were stable in the comparison made day by day. The premium paid to the “Chinese ox” returned. The return is gradual, still with occasional deals. In the Northern Region of Minas Gerais, the greater supply of cattle resulted in a drop in the price of live cattle. In the daily comparison, the price of the ox fell USD 0.79/@ (R$4.00). In the Southern Region of Tocantins, with shortened slaughter schedules, buyers improved the offer for the acquisition of fat cattle by USD 0.39/@ (R$2.00). For females, prices are stable on a day-to-day basis.
Brazil: Livestock Performance in W12 of 2023 (Mar 27)
During the past week (12th week of 2023, March 19th to 25th) while the live cattle market remained retracted until mid-week due to the weakness in the domestic beef market, the release of exports to China created a boost in a business carried out with cattle ranchers and expressive readjustments in the last two days of business. The result in the live cattle market was an average weekly price of USD 56.20/arroba (R$285.08), meaning an increase of 2.5% in the week and a significant drop of 18.1% over the same week last year. For now, the average price accumulated over the course of March reached USD 54.85 (R$278.24), meaning retreats of 4% and 19.3% over, respectively, last February and March of last year.
Brazil: The Average Daily Price of Live Cattle Points to an Evolution of 110.1% During March (Mar 31)
According to the monitoring of the average daily price of live cattle during March, although showing small setbacks in recent days, the ruminant continues to present an evolution well above that achieved in the same period last year. In any case, it is worth mentioning that the price level is 15% below that period. The current daily average price shows an increase of 110.1% over that received on the last closing day of last February, surpassing by almost 8.9 percentage points the index of 101.2% reached in the same period of last year. The reopening of the Chinese market to Brazilian products has brought new energy to the business environment in recent days.
Paraguay: First Period of Vaccination Against Foot-And-Mouth Disease Reached 13.4M Cattle (Mar 27)
The National Service for Quality and Animal Health (Senacsa) reported that at the end of the current vaccination period 2023, 13.404M cattle have been immunized against foot-and-mouth disease, and a total of 134.58K owners have been registered. According to the data obtained, the drop in the stock would be close to 130K heads. The numbers released by the state entity indicate that vaccination against foot-and-mouth disease by the animal population had general progress of 98.74%. On the other hand, 985.58K calves have been vaccinated against Bovine Brucellosis, an overall advance of 96.77%, and 17.74K owners have been registered. It was also reported that the second vaccination period 2023 will begin on May 8 and end on June 9, while registration will be extended until June 23.
Paraguay: Low Beef Supply and High Demand Continue to Drive Farm Prices (Mar 30)
Paraguay closes this week with a rise in the price of steers due to restricted supply and firm demand, after rising 10 cents to USD 3.60 kg/hook. It is the second most important increase registered in the region, behind Brazil (19 cents). According to the consultant's records, Paraguay has not approached USD 3.60 since the fourth week of February of this year, when on that occasion it closed with USD 3.65 due to the low supply due to the effect of the national anti-foot-and-mouth campaign. In Brazil, an increase of 19 cents was registered, since it reached USD 3.75. After four weeks of restrictions to send meat to China due to the impact of the mad cow, the price of the Brazilian steer reacted positively to the rehabilitation of exports.
The full-scale war of the Russian Federation against Ukraine led to the fact that the number of cattle in Ukraine decreased by 376.8K heads. This is reported in the Association of Milk Producers. The increase in the number of cattle and cows in the farms of the population may be connected not only with seasonal growth but also with the clarification of data on the number of animals that were kept in the farms of the front-line regions, which were lost or not made public in the conditions of military and political instability in 2022, said the analyst of the Association of Milk Producers, Georgy Kukhaleishvili. According to him, the number of animals in the industrial sector of Ukraine has increased. The increase is about 86.1K heads, if compared with February data. The expert explained the appearance of such a plus by the relocation of enterprises. Also, the inconsistency of the data is due to the inability of some regions, due to the war, to provide statistical reports.
From the 1st of April to the 12th of May, North Chungcheong Province will launch a simultaneous vaccination of cows and goats to prevent foot-and-mouth disease. According to North Chungcheong Province on the 28th, the targets for vaccination are 269K cattle in 632 cattle farms and 66K animals in 1,445 goat farms. The province invests a vaccination budget of USD 6.9M (9.1B won) in 2023. The vaccine is provided free of charge to farms raising fewer than 50 cows and goats. For full-time farmers raising 50 or more cows, half of the purchase price is subsidized. For farms with less than 100 cows and less than 300 goats, public veterinarians visit and provide vaccinations. Chungcheongbuk-do conducts an antibody test one month after vaccination.
Morocco: Receiving the First Live Cattle Shipment From Brazil (Mar 30)
On Mar 26, Morocco received the first shipment of live cattle from Brazil. 2.8K cattle were shipped from the state of Pará and arrived in the Arab country through the Jorf Lasfar port on the Atlantic coast, southwest of the national capital Rabat. Another 3K live cattle are expected to arrive at the same port on April 8. According to Felipe Heimburger, Economic and Commercial head of the Brazilian Embassy in Rabat, the market for live cattle from Brazil was opened earlier this year. “The international veterinary certificate was approved in January, during a mission of the Moroccan health authority to Brazil, which signed an agreement with the Ministry of Agriculture and Livestock,” said Heimburger to ANBA.
Mozambique: Over 40K Cattle Were Vaccinated in Tete (Mar 30)
Over 40K head of cattle has been vaccinated against foot-and-mouth disease in the central Mozambican province of Tete. "The rainy season and financial constraints are the main barriers for the province to reach the planned total of 75.45K animals immunized', said the head of livestock in the Tete Provincial Directorate of Agriculture and Fisheries, Cláudio Gule. The current number of cattle vaccinated is only half of what was planned. According to Gule, the vaccines (150.9K doses in all) were received in December "but the rainy season has created difficulties in terms of accessibility by road to some remote areas. It limits our work.'
Fresh Beef
Global: Five Countries Hold 67% Of Production Among the Largest Beef Producers in the World (Mar 28)
A report released by the USDA at the opening of this year points out that total beef production by the main producing countries tends to show a slight drop of 0.4% during 2023. The five largest producers, in turn, may show a drop rate more accentuated, around 1.5%. The United States remains the largest producer with just over 12M MT produced, equivalent to 20% of world production. It points, however, to an annual drop of more than 4%. Brazil, in second position, will produce almost 10.6M MT, increasing its volume by 2% and representing 18% of the globalized total. China, the third largest producing country, may increase its annual volume by more than 3%, while the European Union and Argentina will decrease their volumes. The group of five countries has a volume of almost 39.7M MT, accounting for 67% of the total beef produced among the largest-producing countries in the world, according to the report.
US: Weekly USDA US Beef Export Sales (Apr 1)
Beef net sales of 11.3K MT for 2023 were down 40% from the previous week and 10% from the prior 4-week average. Increases were primarily for Japan (2.7K MT, including decreases of 900 MT), China (2.5K MT, including decreases of 100 MT), Taiwan (1.7K MT, including decreases of 100 MT), South Korea (1.6K MT, including decreases of 400 MT), and Canada (700 MT). Exports of 16.6K MT were up 23% from the previous week and 13% from the prior 4-week average. The destinations were primarily South Korea (5.1K MT), Japan (3.8K MT), China (2.2K MT), Mexico (1.3K MT), and Taiwan (1.1K MT).
Brazil: China Reopens Its Market for Brazilian Beef Exports Following a Mad Cow Case Scare (Mar 27)
China reopened its market for beef exports from Brazil in W12, on Mar 23. The information was passed on to the Minister of Agriculture, Carlos Fávaro, and to the Brazilian delegation in Beijing by the country’s General Administration of Customs (GACC). The sales halt came to an end after a month. They had been paralyzed since Brazil imposed a self-embargo following the identification of an atypical BSE case (when the disease manifests itself in an animal spontaneously rather than through herd transmission) of mad cow disease in the state of Pará. In a post on its website, GACC said, “After due consideration, Brazil’s mad cow disease prevention and control system complies with China’s quarantine and health requirements, and it is decided to allow Brazil to resume export of boneless beef under 30 months of age to China from March 23, 2023.”
Brazil: Saudi Arabia, Jordan, Malaysia, and Palestine Lift Embargo on Beef From Brazil (Mar 27)
Saudi Arabia, Jordan, Malaysia, and Palestine have also reopened their markets for beef exports from Brazil, according to information from the Itamaraty. The withdrawal of embargoes from these countries, however, took place in mid-March, before the decision taken by China on Mar 23rd to resume purchases from Brazilian slaughterhouses. Like the Chinese, 10 other countries applied embargoes due to the case of "mad cow disease" registered in Pará in February. Some, however, removed the barriers soon after the exams confirmed that the episode was atypical when it occurs spontaneously in older animals and has no potential to affect the health of the country's herd. Six still maintain barriers. In practice, China could also have lifted the embargo on March 2, when the World Organization for Animal Health (WHOA) recognized the case as atypical and maintained Brazil's status as a country with insignificant risk for the disease.
Brazil: Angus Sets New Beef Export Record (Mar 29)
Certified Angus Beef reached a new export record. The total shipped to the foreign market throughout 2022 reached the mark of 1.88K MT, according to data compiled by the Brazilian Association of Angus and released this month after the year's final balance sheet at the entity's board meeting. The amount is 102% higher than consolidated in 2021 when shipments totaled 934.01 MT. “This result is motivated by the increase in shipments to China and countries in the Middle East”, says the president of the Management Committee of the Certified Angus Beef Program, Nivaldo Dzyekanski, also highlighting the opening of the market to Malaysia, Portugal, and Thailand and the sale of other types of products, such as the original entrails, sausages, and hamburgers.
Argentina: First Export of Beef to Mexico (Mar 27)
After more than 10 years of negotiations, the first export of Argentine bovine meat to Mexico was completed a few days ago, from the Ezeiza international airport, where agents from the National Agrifood Health and Quality Service (Senasa) verified the quality of the meat shipped merchandise. The commercial sample, from Arrebeef, consisted of a ton of different cuts of beef. It should be noted that there are another 21 establishments that have the authorization to export to this destination.
Argentina: Meat Exports, China in the Center of the Scene (Mar 27)
In W12, beef export figures for the month of February were released and the numbers do not cease to amaze. A total of 73K MT of bone-in beef were shipped in the month, a volume similar to that registered in January, which had also been high for the time of year. Usually, the first two months of the year are not periods of high levels of shipments for Argentina. This response to the high concentration of sales to China, a country that during this time is not usually very active in the market is a result of the commercial impasse that is generated during the Lunar New Year festivities, which take place between mid-January and early February of each year. However, this year China continued to buy at a very sustained pace during both months. The output data from Argentina show purchases of about 55K MT/ month (carcass equivalent), 22% more than what was registered on the same date last year. Clearly, China's beef supply needs are growing. According to the latest projections from the United States Department of Agriculture (USDA), the need to import beef this year would amount to 3.5M MT, which is the highest number ever recorded by the Asian giant.
Japan: Lifting 20-Year Restrictions on Canadian Processed Meat (Mar 27)
Japan has removed 20-year restrictions on Canadian imports of processed meat, allowing trade to expand, Agriculture Canada said on Mar 27. Japan, like many other nations, restricted imports of Canadian beef after the discovery in 2003 in the province of Alberta of a case of bovine spongiform encephalopathy (BSE). Importing countries gradually lifted restrictions, and Japan's latest move lifted remaining restrictions affecting Canadian processed meat such as hamburgers, a government spokesman said. Japan, Canada's second-largest beef and veal export market in January according to Statistics Canada data, lifted restrictions on March 22, the spokesperson said. Japan bought USD 379.29M (C$518M) worth of Canadian beef and beef products last year.
Data Analysis: Wagyu Beef Prices in Tokyo Fall to Their Lowest Levels Since 2020 (Mar 27)
Wholesale prices of Wagyu beef in Tokyo, Japan stood at USD 7.47/kg (JPY 980) on March 27, 2023, marking a decline of 9% MoM and 21% YoY. Although this price represents a 9% increase compared to the previous week, it falls within the normal inter-weekly volatility range for this commodity. The decline in prices can be attributed to generalized inflation, which has impacted Japanese consumer demand and driven them to seek out cheaper alternatives. Additionally, there has been an increase in supply, with Wagyu cattle slaughter rising 2% in 2022 and Wagyu beef production expanding, according to the USDA's latest Livestock and Products report for Japan. Looking ahead, the re-opening of the economy after COVID-related restrictions and an expected increase in tourism during 2023 are bullish factors for prices. Moreover, overall input costs remain high, which may eventually translate into higher prices. Nevertheless, the upside potential is limited due to the growing preference for cheaper meat in the current economic context.
Data Analysis: Hanwoo Beef Prices in Korea Fall to a Multi-Year Low on Oversupply and Easing Demand (Mar 27)
After trading flat at USD 9.11/kg (KRW 12,004) since December, Hanwoo beef (Grade 2B) wholesale prices in Gyeonggi, South Korea, fell on March 20 by 9.4% WoW and 27% YoY to their lowest level since at least three years, at USD 8.25/kg (KRW 10,875). This recent decline is part of a downward trend that began in late 2021 as a result of oversupply, but it was further exacerbated in 2022 as a result of easing demand due to inflationary pressure on consumers, which was favoring cheaper protein. The trend of oversupply and easing demand has continued so far into 2023. Moreover, cattle slaughter is being incentivized by the Korean government in order to reduce cattle herd numbers, but in the short term, this has caused beef production to increase further augmenting the pressure on beef prices. Moving forward, the increase in production due to a faster cattle slaughter pace is expected to maintain prices depressed. Nonetheless, demand could pick up as Korea incentivizes consumption and exports of domestic beef, which could help to shrink the downside room.
Data Analysis: Limousin Beef Prices Indonesia Fall at Start of Ramadan, Could Rise in Coming Weeks (Mar 27)
Limousin beef prices in Jakarta, Indonesia fell by 1% WoW and 4% MoM during the week starting March 27, 2023, reaching their second-lowest level in almost a year. The decline in prices seems to be due to a faster pace of cattle slaughter, resulting in increased beef production during the previous week. Producers increased the pace of slaughter ahead of Ramadan in anticipation of a rise in demand, but it appears that demand has not yet picked up. Reports from Australia indicate that live cattle exports to Indonesia during the same period were slower than in previous years, indicating lower demand from the country. Moving forward, prices are expected to pick up as the Ramadan season continues, before falling back to a more stable level for the remainder of the year. In 2022, Indonesian imports of frozen beef reached a record high of USD 813M, with the majority of imports coming from India, Australia, Brazil, and the US.
China: Beef Consumption Reporting a Positive (Mar 31)
That's according to Rabobank's newly released Q1 Global Beef Quarterly, which says it expects overall Chinese household consumption will rebound strongly in 2023 from the low base of 2022. Despite marginal growth in food and beverage retail and the impact of ongoing COVID restrictions on food services, there are positive signs of recovery. Rabobank agricultural analyst Genevieve Steven says they're seeing changes in the recent behavior of Chinese consumers, who are becoming more pragmatic in spending money on products they perceive to be practical, valuable, and worthy. However, she says weaker economic conditions will have some impact on Chinese beef consumption among lower-income groups.
Frozen Beef
Argentina: Meat Exports Grew in February in Volume but Decreased in Value (Mar 27)
Argentine exports of refrigerated and frozen beef in February reached a volume close to 51.5K MT by product weight for USD 211.3M, informed the Consorcio de Exportadores de Carnes Argentinas (ABC). In relation to February 2022, the volumes exported are 8% higher; while the value obtained was 22.2% lower, added the ABC in its monthly report. In the accumulated of the first two months of the year, sales abroad of refrigerated and frozen bovine meat were close to 103K MT by product weight for USD 421.5M; this represented an increase of 19.3% in volume and a drop of 13.4% in value in relation to the first two months of 2022. The average export price of refrigerated and frozen bovine meat was USD 4,102/MT in February, a value 0.2% higher than that obtained last January; and 28% lower than the average price for February 2022, which had been USD 5,694/MT.
