(WEDNESDAY 16) Brazil will consume more beef in 2023, according to Rabobank

After the per capita consumption of beef in Brazil reached its lowest level in more than a decade in the last three years, the outlook for 2023 is for growth in domestic sales.

This is indicated by a report by Rabobank, which indicates that the volume consumed by Brazilians should go from the current 27.7 kilos per inhabitant per year to 28.2 kilos, an increase of 1.5%.

According to the bank’s animal protein analyst, Wagner Yanaguizawa, “the baseline scenario we are working on is a economic recovery in purchasing powerreflecting an economic environment of lower interest rates and lower inflation, which should favor the consumption of beef”.

Beef production next year is expected to be 10.5 million tons, which represents an increase of 2%, according to a note collected by the portal agromeat.com. The analyst highlights the drop in calf prices and the increase in the discarding of females this year as signs of a reversal of the livestock cycle, with a greater supply of animals ready for slaughter and a reduction in the average price of the arroba, today close to R $ 300.

“This scenario of increased supply should put pressure on arroba prices, but it should also recover domestic consumption levels, mainly due to this sharp drop that we have been seeing in recent years,” the analyst points out. (Read: How did Brazil become the largest exporter of beef in the world?)

Yanaguizawa also mentions the preference of Brazilians for beef over poultry and pork, whose demand has been favored by the loss of purchasing power of the population in recent years.

“We know very well that there is a strong cultural appeal for beef by Brazilians, then, if there is a lower price difference in relation to chicken and pork, we will see increases in the consumption of beef in the domestic market”, he maintains.

Mainly affected by the drop in domestic beef consumption, small and medium-sized slaughterhouses should benefit the most from this recovery, if Rabobank’s forecasts are confirmed.

Without access to the international market, many have closed their doors in recent years as the sector faced rising costs and falling revenues.

“In fact, those who managed to overcome this challenging moment due to costs, even with narrower margins, and managed to stay in the sector, I have no doubt that starting next year they will see a better scenario in terms of liquidity,” explains Yanaguizawa. . (Read: Brazil continues in its efforts to increase meat exports to the US.)

more exports

On the other hand, a report from the portaldbo.com.br portal indicates that

The United States, the second largest buyer of beef in the world, behind China, could close a new trade agreement with Brazilian exporters in 2023, since, according to current estimates, protein production in the North American giant tends to suffer a reduction of 3.5% next year, compared to the estimated result for 2022.

This expectation, says the portal, was mentioned by Rabobank analysts in a study called “Perspectives for (Brazilian) Agribusiness in 2023”.

According to the work, Brazil faces the challenge of maintaining the focus of the negotiations on the tariff issue that implies the entry of bovine meat into the North American market.

Instead of having a specific export quota/tariff, Brazil has entered a category where it competes for the market with other producers. The total quota for this group is 64.8 thousand tons per year.

This year, Brazil completed the volume allowed by the quota at the end of the first quarter, reports Rabobank.

By exceeding the maximum allowed by the quota established by the US authorities, Brazilian beef exports must pay a tariff of 24.6%, which reduces the competitiveness of the product.

(WEDNESDAY 16) Brazil will consume more beef in 2023, according to Rabobank