Where’s the ox? Arroba hits BRL 330 in new bullish round

@joaopedrodiasnc

Live cattle prices rose again, mainly in São Paulo; The scenario of restricted supply and increased demand are essential to maintain the upward bias!

The physical market for live cattle registered firm prices and, in some negotiations across the country, high prices were reported this Thursday, the 23rd. As the month of June draws to a close, the entrance to the ox off-season brings changes in the supply of animals for slaughter. That way, according to projections, arroba can still rise by another R$ 10 in the coming weeks!

THE week continues to guarantee the bias that keeps prices highand the business environment again suggests continuity of this movementconsidering that the slaughterhouses still operate with shortened slaughter schedules, serving an average of five working days. This scenario, added to exports, should bring a better position to ranchers.

According to Scot Consultoria, in its daily report, the rise in the arroba price heated up business in São Paulo. Thus, in the daily comparison there was an increase of R$2.00/@ of live cattlenegotiated for R$310.00/@, gross price and forward.

To the fat cow and heifer prices remained stablebut firm, negotiated for R$280.00/@ and R$300.00/@, respectively, gross and forward prices.

The reference for the China ox is R$325.00/@, but occasional deals of up to R$330.00/@ already occur. According to the Agrobrazil Appwho celebrated yesterday on his Instagram social network, the best negotiation was announced by the rancher from São José do Rio Preto, in the interior of São Paulo, the price was R$ 330.00/@ with payment within 30 days and slaughter scheduled for June 28th.

Following the upward trend in the market, the Indicator of the Boi Gordo Cepea, yesterday’s closing brought an appreciation of 0.08%, in the daily comparison. Thus, prices are already above R$ 320.00/@ for five consecutive days, as shown in the chart below. In dollars, the price remains at US$ 61.53/@.

“As anticipated, the supply of animals in the transition period from the harvest to the off-season for live cattle is restrictedwhich provided the necessary conditions for the price reaction across much of the country. At the same time, exports remain at a good level, both in terms of volume and in terms of revenue“, highlights Iglesias.

According to Agrifatto, the futures market on B3 was upside, the futures maturing in Jun/22 ended the day quoted at R$ 325.40/@, with a daily variation of 0.42%.

Larger calf shedding improves exchange ratio

Since the end of last year, the terminator rancher has been observing an improvement in purchasing power. According to Cepea researchers, this scenario is related to the fall in calf prices much more intensely than the devaluation observed for live cattle. In the accumulated of this year’s partial (from December/21 to June/22 partial), while the price of live cattle fell 11.23%, the decline in the value of the calf reached almost 18%.

In view of this, in this partial of June (until the 21st), the exchange ratio of arroba of fattened cattle for calf is the most favorable to the terminator since December 2019, that is, the purchasing power of the terminator rancher is the best in terms of more than two and a half years.

Photo: Correa da Costa

When considering the animal ready for slaughter traded in São Paulo (Indicator CEPEA/B3) and the calf in Mato Grosso do Sul (Indicator ESALQ/BM&FBovespa), the terminator needs, in this partial of June (until the 21st), of 7 .97 arrobas of fattened cattle for the purchase of a calf.

Last month, the terminator needed 8.43 arrobas to make the same purchase, and in June 2021, 9.5 arrobas. In December 2019, it took 7.46 arrobas.

Agência Safras brings the tour through livestock squares

  • In São Paulo (SP), the reference for the arroba do boi was R$ 323 in the term modality.
  • In Dourados (MS), prices are R$ 299.
  • In Cuiabá (MT) it was indicated at R$ 282;
  • In Uberaba (MG), prices start at R$310.
  • In Goiânia (GO) prices were R$ 305 per arroba.

beef wholesale

The wholesale market recorded stable prices. In the wholesale of São Paulo, sales remained firm compared to the first half of the month, with that all cuts went through a positive adjustment of approximately 3% last Thursday, pointed out Agrifatto.

At first, the business environment points to less room for readjustments during the second fortnight of the month, a period with less appeal for consumption. In this way, the forequarter of the ox was priced at R$17.20 per kilo and the hindquarter was priced at R$22.50. Finally, the needle point was quoted at R$ 16.50.

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