Brazil cattle production outpaces meatpacker demand - Cepea
Cattle prices dropped throughout 2023
26 February 2024
2 minute read
By: IBGE data about the number of slaughtered animals in 2023 confirm what quotations had already shown: supply from Brazilian cattle farmers surpassed demand from meatpackers, leading to price drops throughout the year, according to a market report from Cepea.
Data indicate that 33.9 million animals (both male and female) were slaughtered last year, which is close to the record verified in 2013 (34.4 million animals). Compared to 2022, the increase is 13.2%. Specifically in the fourth quarter of 2023, slaughters surpassed 9 million animals, a record for a quarter, and 20% up in relation to the same period in 2022.
Due to the increase of ready-to-slaughter animals supply, the Cepea/B3 Index for fed cattle (São Paulo State) dropped 12% in the accumulated of 2023, in real terms, finishing December at BRL 247.96.
Meatpackers were (and are) willing to close deals to export, but this segment, which purchases roughly one quarter of the Brazilian beef (26% in 2023), was not able to sustain quotations due to the high supply. A demand reaction from Brazilians would be necessary; however, their limited purchase power did not allow the consumption increase.
As for the supply, producers have been investing in genetics and in feeding, at the same time others have been slaughtering female animals, since they are not satisfied with calf prices. Cepea data indicate that values of these animals have been moving down for approximately three years.
