Brazilian Cattle Slaughter Steady
BRAZIL - Brazilian cattle slaughter during the nine months to March was relatively steady, at 21.7 million head, only 0.3 per cent below the corresponding period in 2009-10.
4 July 2011
2 minute read
However, the volume is still well below the 23.7 million head processed during the same period in 2006-07, according to analysts at Meat and Livestock Australia.
The relatively steady slaughter numbers and higher prices reflect the tight grown cattle supplies in Brazil since 2007. Brazil experienced a period of high slaughter (especially female) in the mid 2000's - years in which export and domestic demand grew considerably, while at the same time, low profits saw many Brazilian producers liquidate herds and exit the industry.
Slaughter during the first quarter of 2011 totalled 7.1 million head, up 0.2 per cent when compared to the first three months of 2010. Interestingly, supply figures have remained relatively stable, even with a 35 per cent increase in average prices over the same period, to BR$3.48/kg lwt (or up 46 per cent to 208US¢/kg lwt).
Given the tight supplies and high prices, meatpackers have focused on maintaining capacity utilisation, with increased female throughput. Female slaughter rose to 43.5 per cent in the March quarter of 2011, up from 39 per cent during the same period in 2010 and 41.7 per cent in 2009.
Despite growth forecasts for the Brazilian herd in 2011, the expansion may take longer than expected, as the higher prices are anticipated to encourage producers to market additional breeding cattle for slaughter. In addition, while export markets remain volatile, a strong domestic market is expected to continue to support prices, absorbing any decline in export volumes over the medium term.
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