22 November 2010

2 minute read

Following herd liquidation last year, Argentinean beef output is expected to fall by 21 per cent to 2.7 million tonnes for 2010, reports Peter Duggan, Strategic Information Services, for the Irish Food Board, Bord Bia. Despite Argentinean beef consumption falling by 16 per cent to 56kgs per head according to the USDA, beef exports for the first seven months of the year fell by 52 per cent to 117,000 tonnes pw.

In Brazil, beef output is expected to grow by three per cent to 8.5 million tonnes in 2010. This steady recovery in Brazilian output has been boosted by an increase in domestic and export demand. Despite the Brazilian Real strengthening against the US dollar this year, export demand grew by six per cent to 866,000 tonnes pw for the first nine months of the year.

Most of the growth in Brazilian beef exports occurred in the Middle Eastern region. Shipments to Iran and Egypt grew by 200 per cent and 66 per cent respectively. Meanwhile shipments to the EU were two per cent higher at 89,000 tonnes pw. This reflects the number of farms approved to supply the EU increasing modestly. The number of farms approved now stands at 2,200 farms.

In response to tightening South American supplies and increased export demand from the Middle East and Russia, prices for Argentinean and Brazilian steers have risen sharply since the beginning of the year. In euro terms Argentinean steer prices are up by 89 per cent at €2.16/kg for the first 10 months of the year, while Brazilian prices are up by some 24 per cent at €2.20 for the same period. The increase in the Brazilian price has almost corresponded with the Brazilian real strengthening by 20 per cent on a year to date basis, which has reduced the level of price rise evident in euro terms.

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