May 29, 2012

Brazil's beef exports have dipped just under 2% by volume and revenue in the first quarter, compared to 2011 but may rebound in the second quarter with a favourable exchange rate, according to the Brazilian Association of Meat Exporters, or Abiec.

Beef exports totalled US$1.66 billion in the first quarter, down 0.21% from the same period a year ago, while sales by volume totalled 348,900 metric tonnes, down 1.49% from this time last year. Despite declines for both volume and revenue, the average price per tonne for Brazilian beef exports rose by 1.3% on-year, to US$4,770.

The continued weakening of Brazil's currency, which broke the plane of US$1 during the week of May 14 for the first time since July 2009, should help beef exports rebound in the second quarter, according to analysts with Informa Economics in Brazil. Cattle supply at the end of this season should also contract, pushing prices up for exporters.

Beef availability in other key export markets should reduce in the coming quarters, Informa added, citing recent drought in the U.S. and foot-and-mouth disease outbreaks in Paraguay.

Russia remains the main export market for Brazilian beef, despite an on-going trade embargo against dozens of processors in Brazil. Sales to Russia in the first quarter totalled 89,200 tonnes, down 10.4% from Q1 2011, and US$394.7 million in revenue, down 11% from the year prior.

The EU ranks third with 30,840 tonnes and US$224.8 million, followed by Venezuela with 25,205 tonnes and US$127.9 million.