\nPorto\nAlegre, October 23, 2020 – Brazilian\nexports of animal protein lost intensity in September, but the year\u2019s\ncumulative balance remains very positive. As already discussed, the\nresult is a consequence of the strong pace of purchases from China\nthis year, seeking to fill the supply gap formed by African swine\nfever (ASF). The news of the replenishment of the pig herd in China\nis recurrent, but meat production will not increase suddenly, as pig\nfarming has a cycle that needs to be respected. What is more likely\nis that production begins to show a gradual recovery from the last\nquarter of 2022. The intention of the Chinese government is the\nadoption of a more professional regime, with greater integration\nalong the production chain.<\/p>\n\n\n\n
\nFor\nthe last quarter, China is expected to absorb even more significant\nvolumes of beef from Brazil, given the early planning of stocks to\nmeet the demand during the country\u2019s main holiday, the lunar new\nyear. The preliminary figures for October already show a good\nincrease in the pace of shipments, which tends to accelerate in the\ncoming few weeks, emphasizing that the exchange rate parity keeps\nBrazilian animal protein highly competitive in the international\nmarket. By way of comparison, an arroba of fattened cattle costs\naround USD 70 in the United States, while in Brazil the arroba costs\njust over USD 45, which undoubtedly reflects the price of the traded\nmeat.<\/p>\n\n\n\n
\nPork\nexports are still the main highlight of the meat industry\u2019s trade\nbalance in 2020, with an emblematic growth of 45% in relation to the\nsame period last year. From January to September, Brazil shipped\nroughly 752 thousand tons of pork, against 519 thousand tons in the\nsame period of 2019. In terms of revenue, the result is even more\nsatisfactory, with approximately USD 1.66 billion, nearly 55% higher\nfrom the same period last year. China still accounts for\napproximately 50% of Brazilian pork exports. Logically, this\ndependence is the main justification for Brazilian shipments to have\napproached 100 thousand tons per month.<\/p>\n\n\n\n
\nThe\nresult of monthly beef exports was below market expectations, but the\nresult is still satisfactory, above 240 thousand tons in carcass\nequivalent, only 2% higher than in September 2019. The highlight\nremains on beef exports to the Chinese market, with more than 100\nthousand tons shipped in carcass equivalent. Hong Kong is still the\nmain destination, with shipments of roughly 33.6 thousand tons in\ncarcass equivalent. Directly or indirectly, China accounts for\napproximately 55% of Brazilian exports.<\/p>\n\n\n\n
\nIn\nterms of revenue, much has been said about the decline in revenue\nduring September. This movement concerns two factors, the first of\nwhich is the exchange rate variation, which produces this type of\neffect on the average price of Brazilian products in the\ninternational market. The second aspect that needs to be considered\nis the decline in the average price paid by China, which started to\nrenegotiate its import contracts between the months of December and\nJanuary, a period in which China paid more than USD 6 per kilogram of\nBrazilian beef. Since then there has been a gradual decline in\nprices, which in the last month of September reached an average of\nUSD 4.20 per kilogram, down 5.7% from September 2019. This item will\nbe better addressed in the following topic.<\/p>\n\n\n\n
\nConsidering\nthe average revenue, Brazil collected around USD 660 million last\nSeptember, down 1.62% from the same period last year. However, the\noverall balance remains very positive, with beef exports raising\naround USD 6 billion from January to September, up 23% from the same\nperiod last year. This revenue growth has to do with the increase in\nthe volume of shipments, since the average price has decreased in\n2020. In terms of volume, Brazil exported around 2.14 million tons of\nbeef, in carcass equivalent, roughly 13.87% higher than in the same\nperiod last year.<\/p>\n\n\n\n
\nFor\nchicken, the overall performance is more discreet compared to the\nother two proteins. This movement is justified by a lower volume\nexported to traditional importers, such as the countries of the\nMiddle East and Japan. With a possible recovery in these markets, the\nexpectation is that the good pace of shipments will resume. From\nJanuary to September, Brazil exported around 3.1 million tons, an\nincrease of 2% in comparison with the same period last year. Revenue\nfell around 11% due to the exchange variation between one year and\nanother, bringing down the average price of Brazilian chicken.<\/p>\n\n\n\n
\nWith\nthe expectation of an excellent pace of shipments during the last\nquarter, there will be consequences in the domestic market, with room\nfor even sharper upward movements in the entire meat sector. The\npoint of limitation is the ability of the end consumer to absorb this\ntype of movement. Even with this restriction, all indicators suggest\nthat the last two months of the year will have record prices,\ncontributing to the maintenance of the trend of inflation for basic\nconsumer products.<\/p>\n\n\n\n
\nSAFRAS\nLatam<\/p>\n","protected":false},"excerpt":{"rendered":"
Porto Alegre, October 23, 2020 – Brazilian exports of animal protein lost intensity in September, but the year\u2019s cumulative balance remains very positive. As already discussed, the result is a consequence of the strong pace of purchases from China this year, seeking to fill the supply gap formed by African swine fever (ASF). The news […]<\/p>\n","protected":false},"author":16,"featured_media":18078,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[102],"tags":[],"commodity":[],"class_list":["post-20583","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-agribusiness-en"],"acf":[],"yoast_head":"\n