March 22, 2005

Brazil faces falling beef prices despite rise in exports

A study released earlier this month by the Brazilian Confederation of Agriculture (CNA) shows that the beef cattle sector began the year maintaining the loss of income registered in 2004.

This resulted in a combination of lower prices paid for cattle ready for slaughter and a rise in production costs.

The cost of production rose 0.22 percent in January, whereas the slaughter cattle dropped 3.18 percent, according to the study done with the University of Sao Paulo's Center of Advanced Studies in Applied Economics.

The price of slaughter-ready cattle fell 0.03 percent but the production cost increased 10.10 percent in 2004.

Brazil stands first in the Beef Export, as per the CNA/USP team.

The country earned US$ 2.021 billion by exporting 1.5 million tonnes of beef, including the fresh and processed meat in the period January-October 2004.

The CNA/Cepea study showed that, despite the favorable export sale prospects, the beef production sector in Brazil is experiencing a crisis when it comes to the price paid to ranchers.

The production cost rises by 9.04 percent and price of fattened cattle fall by 2.13 percent, as per the analysis of the largest 9 states responsible 78 percent of domestic herd.