Does this well has an end?

Currently in the off-season, the cattle market stays “loose”. In São Paulo, the prices have dropped for the second week in a row. The fat cattle that supplies the national market is being negotiated at R$225,00/@. Meanwhile, the “China cattle” is negotiated at R$ 230,00, with a R$ 5,00/@ premium.

The current price has reached the all time minimum since 2020’s july. There are tests below the reference and the break through this threshold is not discarded.

The last week scenario remains still. Beef prices lower, high competitivity among the other meat types, with an emphasis on chicken meat, and a good number of cattle offer, following the livestovck cycle in the 2023 season.

IBGE infromed, today (10/08), preliminar data on the bovine culling in Brazil. Throughout 2023’s second quarter, the bovine culling grew 12,3% and 11,0% in the quarter and annual comparatives. The total number, in this quarter, was of 8,25 million bovines culled. The culling in the second quarter is the biggest one, in quarter terms, since 2019’s third quarter.

There is a greater availability perspective in the beef at national market, when compared to the last few years. Which may result in a better domestic consumption, but the competitivity against pork and chicken meat, keeps the sector pressured.

In the international market, if the exchange rate cooperate and the greater demand perspectives become true, there is space for positive adjustments to export premium. Those factors may only be punctual and won’t change the current scenario, though.

The current scenario is challenging and must remain unchanged in the short and medium periods. To the producer, it will be vital for the business’s health consider that , when we reach the botton of the well, the only way out is upwards.