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Brazilian Pork Prices Weaker - Broiler Beef Prices Up

06 September 2013

BRAZIL - The recent rise in hog and pork prices in Brazil weakened in late August in most regions according to data from Cepea.

In some areas, quotes registered small decreases.

The supply of slaughter-ready animals, which was low, increased slightly compared to the demand. On the other hand, in the Southern Brazil, prices kept the upward trend, favored by the good exports performance.

Cattle

Calf prices in the cattle sector have risen this year, showing a 9.4 per cent increase from January to July, based on a “Brazilian average”, calculated by Cepea on prices from typical farms in 10 states (Goiás, Minas Gerais, Mato Grosso do Sul, Mato Grosso, Pará, Paraná, Roraima, Rio Grande do Sul, São Paulo and Tocantins).

In the same period in 2012 (January to July), prices fell by 1.5 per cent, and for the entire 2012, the decrease was 2.25 per cent.

In 2013, the increase of cost for calf production is attributed mainly to higher prices of calves. The ESALQ/BM&F Bovespa calf price Index (Mato Grosso do Sul State; nelore, 8 to 12 months age) has risen by 15 per cent this year, to close at 804.18 reais (337.47 dollars) on August 30. For the same period of 2012, quotes dropped five per cent.

In August, the Index has registered a monthly average of 800.94 reais, 12.3 per cent more than in the same period last year and the second highest of the Cepea series, in nominal terms, which started in February 2000, behind the July figures this year of 804.25 reais.

In real terms (IGP-DI July/13), the record for calf quotes were verified in July 2008, of 961.41 reais.

In general terms, the costs of calves and lean cattle purchases are the item that cost more in the cattle finishing, not only in Brazil, but also in other beef producing countries.

As for the fed cattle market in late August, prices from calves to beef were firm in the Brazilian market. In general, the supply was below the demand, underpinning quotes.

Poultry

In the poultry market, broiler price rose, leading to the narrowing of price gap between broiler and beef. In August, the average price of 3.15 reais per kilo for chilled broiler chickens was 50 per cent below that of beef carcase quotes (6.27 reais per kilo), in the wholesale market of the Greater São Paulo.

In July, broiler prices were 54 per cent below beef, also in the wholesale market of the Greater São Paulo.

TheMeatSite News Desk



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