Brazil Beef to Go Higher, Milk Price Heads South

BRAZIL – Milk and beef prices are currently heading in different directions, according to market analysts summarising the cattle industry to the end of September.
calendar icon 10 October 2014
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Stronger milk production has met slackening demand, while beef supplies remain tight.

Some analysts are forecasting cattle futures to lift, as three months of stable milk prices have been ended by a combination of cheap feed, lower demand and seasonal variations in supply.

According to the Centre for Advanced Studies on Applied Economics, peak season in Sao Paulo and falling cereal prices have combined to result in a milk glut which is not being met by wholesale demand.

A Cepea analyst said: “The increase of milk price was attributed to the nearness of the peak season in São Paulo and the milk season beginning in central and south east regions.

“Price drops of soybean meal and corn over recent months have led to higher feeding, resulting in higher milk production.”

Beef markets meanwhile have produced the highest calf prices since CEPEA records started in 2000.

Compared to September last year, these animals have increased 35 per cent in value.

Cattle futures, at 132.59 Brazilian Reals on September 30, could rise to 135 until the year end, CEPEA added.

Assocon (Brazilian Cattle Feeders Association) said that feedlot inventories have increased 'only' four per cent on last year.

However, one near bearish factor being mentioned is the seasonal marketing upturn in October.

Michael Priestley

Michael Priestley
News Team - Editor

Mainly production and market stories on ruminants sector. Works closely with sustainability consultants at FAI Farms

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