By Garra - 09/05/2024 in Brazil and World

With strong external demand and slower domestic consumption, Rabobank predicts a record beef slaughter in Brazil

Beef slaughters in Brazil in the first quarter of this year are expected to reach the highest number ever recorded for the period, surpassing the record set in the first quarter of 2014, amidst strong external demand for beef and seasonal decline in domestic market consumption. The forecast comes from a recent Rabobank report.

The seasonal reduction in domestic beef consumption, which accounts for about 70% of the national production, has resulted in supply exceeding demand. This scenario has pressured cattle prices in the futures market and contributed to the anticipation of slaughters as a strategy to reduce costs and secure better prices vis-à-vis slaughterhouses.

Furthermore, according to the Rabobank report, delays in the rainfall onset and the consequent lower accumulated precipitation in important producing regions have led to an increase in feed costs at the end of 2023, which, in turn, has led to a movement to anticipate supply for slaughter, especially of females.

“In this way, slaughters in the first quarter of 2024 may be records compared to the same period in 2014, the highest volume until then,” said Rabobank.

In the second quarter, Rabobank expects a slowdown in female slaughters, but cattle supply is expected to remain high due to “still significant quantities” of male slaughters.

In the external market, the bank stated that recent authorizations by China for 24 Brazilian plants to export beef will consolidate Brazil as the largest supplier of the protein to the Asian country and reinforce the scenario of mutual dependence between the two markets. Brazilian beef represented 43% of the total protein imported by China in 2023.

By February, the volume exported was 408 thousand tons, 25% higher than the same period in 2023, with revenue of USD 1.8 billion, 17% higher than the same period last year.

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