April 29, 2014

Brazil's calf quotes rose more than cattle values

Among Brazilian cattle activities, the calf producing system has been presenting the lowest financial risk over the last few years, according to data from Cepea.

Data from the beginning of 2012 to February 2014 indicate that the profitability of calf producers register an average coefficient of variation of 10.3%. Meanwhile, the profitability of farmers that operate in the complete system and farmers who buy calves and lean cattle registers a coefficient of 12.5% and 18.3%, respectively. A lower coefficient of variation represents a lower risk.

Moreover, calf quotes have been increasing more compared to fed cattle values. In one year (from April 15, 2013 to April 15, 2014), the ESALQ/BM&F Calf Price Index (Mato Grosso do Sul State, nelore animal, 8-12 months-old) increase significantly by 31.5%, while the ESALQ/BM&FBovespa Index (São Paulo State) of fed cattle rose 23.6%.

In the first fortnight of April, calf is the only product of the chain to accumulate increase, of 3% (Index – Mato Grosso do Sul). In the fed cattle market, the Index in SP has decreased 1.7% in the first fortnight of April. In the same period, beef carcass traded in the wholesale market of the Greater São Paulo has downed 1.2%.