Cepea, November 4, 2019 – CATTLE – While the supply of fed cattle for slaughter was low in the Brazilian market in October, the national exports of in natura beef were at a fast pace. This scenario, added to the stock formation for the end of the year at retailers, reduced the domestic availability of beef and increased the demand for new animal batches, underpinning prices for fed cattle arroba and beef carcass in the wholesale market in October.
Last month, the average price for fed cattle arroba (ESALQ/B3 Index, cash price, São Paulo) was 163.25 BRL, the highest, in nominal terms, in all Cepea series, which started in 1994. In real terms, the average price in October was the highest since December/17 (163.96 BRL), but much lower than the record observed in April/15, at 189.89 BRL (IGP-DI from Sept/19).
As for the beef traded in the wholesale market of the Great São Paulo, the average price for beef carcass in October was 11.25 BRL per kilo, the highest, in nominal terms, in all Cepea series (which started in 2001 for this product). In real terms, the average in the month was the highest since January/18 (11.28 BRL per kilo), but much lower than the record, at 12.15 BRL per kilo, observed in April/15.
HOG – The trading pace for live pig was fast in October, largely due to high exports of pork meat, which pushed up pig prices for one more month in the main producing regions in Brazil – African Swine Fever (ASF) outbreaks in Asia have been reducing supply in China, increasing demand in the international market for pork. Besides, slaughterhouses difficulties in finding animal within the ideal weight for slaughter also contributed for the valuations during the month.
This scenario boosted the purchase power of pig farmers against the main inputs used in the activity (corn and soybean meal) – despite the price rises for these products, which were not as sharp. In the SP-5 region (Bragança Paulista, Campinas, Piracicaba, São Paulo and Sorocaba), live pig prices averaged 5.17 BRL per kilo in October, 12.1% up compared to that in September.
In the pork meat market, quotes rose in October too. In the wholesale market of the Greater São Paulo, the average prices for common and special pork carcasses were 7.35 BRL and 7.62 BRL per kilo, a 10.4% increase for both, in the same comparison.
POULTRY – The Brazilian demand for chicken cuts usually consumed in barbecues, such as full wing, drummett, mid-joint wind and heart, increased in October, pushing up the average quotes for these products compared to that in September.
In the wholesale market of the Greater São Paulo, the average price for chicken full wing had the sharpest rise between September and October, by 10.5%, averaging 7.69 BRL per kilo in October. According to Cepea collaborators, despite the higher demand in Brazil, the demand from Asian countries for these products also helped to lower the domestic supply and push up prices.
Frozen chicken prices increased in October too, but not as sharply. Between October 1 and 31, quotes averaged 4.33 BRL per kilo in São Paulo city, 0.9% up compared to that in September. Chilled chicken values remained stable, averaging 4.30 BRL per kilo. Live chicken quotes, in turn, remained firm, underpinned by the balance between supply and demand.