June 1, 2011

Brazilian cattle prices ease in May
 

Brazilian-grown steer prices have eased since late April, largely the result of a slightly higher supply of cattle and the difficulty in passing high beef prices through to end users.

Brazilian consumers have been increasingly switching to lower priced chicken - which is expected to account for 46% of total meat consumption in Brazil. In comparison, beef is expected to account for 39% and pork 15% of total meat consumption.

Local cattle producers have increased marketings of heavy cattle in recent weeks, given the seasonal decrease in rain and lower temperatures. However, processors continue to operate at low capacity, with a reported 43% capacity utilisation in Mato Grosso, the state with the largest herd in Brazil.

However, local analysts expect cattle prices to resume an upward trend towards the second half of the year, probably averaging higher than in 2010.