Fat ox shoots up, goes from R$ 323.60/@ and will go higher!

Live cattle prices rose again in the physical market, especially in São Paulo; The Boi China, on the other hand, goes up around R$ 5.00/@, in the daily comparison!

As expected, and announced by the Portal, the physical market for live cattle recorded high prices this Monday, the 20th, in practically all the cattle ranches evaluated. The scenario of lower supply of animals for slaughter, beginning of the off-season, makes it difficult for slaughterhouses to compose their slaughter schedules. This fact justifies the change in dynamics in much of the country.

In the short and medium term, there are no factors to change the current upward bias that makes up the scenario for the live cattle market. In this way, ranchers remain optimistic and, if they have done their homework of pacing their sales even more, prices should return to the level of R$ 335.00/@ with the turn of the month!

THE price of cattle destined for the domestic market opened the week with new valuations, according to Scot Consultoria. Despite spending part of Monday morning analyzing the domestic market, offers to buy came in above the benchmark for animals with export standards.

Cattle up to four teeth, destined for the Chinese market, are traded for R$320.00/@, an increase of R$5.00/@ compared to the survey on Friday (17/6). According to the Agrobrazil app, the cattleman from Lins/SP reported a negotiation of R$ 320.00/@ for the category, with payment within 2 days and slaughter scheduled for June 23.

The Cepea Fat Boi Indicator opened the week accumulating a new appreciation of 0.97% in the daily comparison. As a result, the price jumped from R$320.50/@ to R$323.60/@, an appreciation of R$9.00/@ just this month. Also according to the institution, the value of the arroba in dollars is still quoted at US$ 62.41/@.

The domestic market reference for the fat cow at R$275.00/@ and for the fat heifer R$296.00/@, gross and forward prices, pointed out Scot Consultoria. Agrifatto, on the other hand, pointed out thatAt B3, the futures maturing in Jun/22 closed the day quoted at R$324.15/@, with a daily variation of 0.20%.

“The supply of finished animals during the transition from the harvest to the off-season for live cattle it is quite restrictedas anticipated for the period. China standard animals are still in high demand on the market, carrying a premium of up to R$30 per arroba in relation to animals destined for the domestic market. The spectacular result of exports in 2022 justifies this situation”, highlighted Iglesias from Agência Safras.

Therefore, say analysts, the next few days should be marked by a fierce dispute between cattle ranchers and meatpackers, with a great chance of new valuations in the arroba due to the period of low supply of fat cattle.

Exports heated in 2022

According to Abrafrigo, the performance in the month maintained the good numbers accumulated in the year. In the first five months of 2021, exports totaled 714,362 tonnes. In the same period of 2022, they were 913,618 tons, an increase of 28%. Revenue, in turn, went from US$ 3.247 billion to US$ 5.1 billion, an increase of 57%.

The entity informs that this year, in addition to the good performance of China in acquisitions, Brazil is counting on an increase in purchases from other markets.

Meat imports from May/2021 to May/2022 (tons):

  • China: from 318,938 t to 440,894 t (+48.3%);
  • United States: from 33,700 t to 90,738 t (+169%);
  • Egypt: from 17,596 t to 66,813 t (+342%).
Photo: Disclosure

With the increase in purchases of Brazilian beef this year, China more than offset the reduction in imports by the city-state of Hong Kongwhich fell by 55%, from 99,200 tons in 2021 to 44,599 tons in 2022.

In total, 109 countries increased their imports in the first five months of the year, while another 38 reduced their movement, informs Abrafrigo.

China standard animals are still in high demand on the market, carrying a premium of up to R$30 per arroba in relation to animals destined for the domestic market.

Giro do Boi Gordo through Brazil, according to Agência Safras

  • In São Paulo (SP) the reference for the at sign of the ox stood at R$ 318
  • In Dourados (MS) it was indicated at R$ 299.
  • In Cuiabá (MT), the arroba was indicated at R$ 281.
  • In Uberaba (MG), prices start at R$310 per arroba.
  • In Goiânia (GO) the indication was R$ 305 for the arroba of the fat ox.

Wholesale, according to Agência Safras

the wholesale market recorded stable prices. According to Iglesias, the tendency to short term still refers to the maintenance of prices, considering the slower replenishment between wholesale and retail during the second half of the month. This is the period with the least appeal to consumption.

“In addition, the consumption pattern delimited for 2022 still refers to the preference of a large part of the population for more accessible proteins, which have less impact on average income“, said Iglesias.

The rear quarter was priced at R$22.50 per kilo. The price of the forequarter of the ox was R$ 16.60. Finally, the price of the needle point was R$ 16.50 per kilo.

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