Cepea, February 18, 2020 – CATTLE – Although in January/2020 Brazilian beef shipments were a record for the month, exports were more than 20% lower than in December/19. This result is linked to the sharp reduction in the purchases from China, the number one destination for the Brazilian beef.
According to data from Secex, in January, Brazil sent 53.2 thousand tons of the product to China, 36.3% less than in December, but more than two-fold the volume exported to the Asian country in January 2019 (23.54 thousand tons).
After having purchased higher amounts of the Brazilian beef in the last months of 2019, aiming to supply their domestic market for the Chinese New Year (which, this year, was celebrated on January 25th), China reduced imports in January. The volumes imported by China in both October and November last year were higher than 83 thousand tons, a record and not usual, meaning that lower exports to China were already expected in early 2020.
BRAZILIAN MARKET – Between January 31 and February 14, the CEPEA/B3 Index for fed cattle (São Paulo State) rose 3%, despite having oscillated during the fortnight, closing at 196.55 BRL (45.71 USD) on February 14.
HOG – After hitting a record in December, the Brazilian exports of pork meat – considering in natura and processed – decreased in January. Still, shipments had the best performance for the month in all Secex series, which started in 1997. According to data from Secex, in January/20, Brazil exported 68 thousand tons of pork meat, 9.1% less than in December, but a staggering 42.4% up compared to that shipped in Jan/19.
The revenue received from the exports in January was one of the highest in the series, favored by both the high prices (in dollar) paid for the national product and the dollar appreciation against Real. Thus, the Brazilian exporting sector received 679.11 million BRL last month, 9.5% down compared to that received in December, but almost two-fold that from Jan/19.
BRAZILIAN MARKET – Live hog prices had opposite behaviors among the regions surveyed by Cepea in the first fortnight of February. In some areas, quotes decreased, pressed down by lower demand. Besides, the high price levels for corn and soybean meal led growers to sell the animals, pressing down quotes.
In some other regions, demand increased, due to the payment of workers’ wages (early in the month). In addition, international purchasers imported higher volumes of the Brazilian pork meat, helping to push up quotes.
Between January 31 and February 14, the sharpest price rise, at 3%, was registered in southwestern Paraná, where live hog quotes averaged 5.35 BRL per kilo on February 14. In the SP-5 region (Bragança Paulista, Campinas, Piracicaba, São Paulo and Sorocaba), values averaged 5.37 BRL/kg, 1.5% up in the fortnight.
The steepest price drops, in turn, were observed in the regions of São José do Rio Preto (SP) and Rondonópolis (MT), at 5.9%, to 5.32 BRL/kg and to 4.69 BRL/kg, respectively.
POULTRY – The Brazilian shipments of broiler meat (processed and in natura) decreased in January/2020 and are the lowest since February 2019. According to data from Secex, last month, exports totaled 232.8 thousand tons, 17.4% down compared to that in December/19. This result was already expected by the sector, since the number of deals for delivery to the international market usually drops in January.
As regards revenue, despite the strong US dollar, the low volume shipped in January lowered the revenue, which totaled 2.20 billion BRL, 16% down compared to that in the previous month.
In general, the major purchasing countries of the Brazilian broiler meat reduced orders last month, mainly China and South Africa – these two countries have been adopting incentive policies to their local poultry sectors, aiming to become more independent.
BRAZILIAN MARKET – Broiler meat prices increased in the Brazilian market in the first fortnight of February. However, quotes for beef and pork meat rose even more sharply, which increased broiler competitiveness against the other two.
In the broiler meat market, although competitiveness is higher, agents from the sector claim difficulties to sell the product in the Brazilian market. Exports, on the other hand, have been firm, which is pushing up quotes in the domestic market.