International

Brazilian Beef Processors Focus on Exports

Originally published by Anna Flávia Rochas, contributing editor, www.meatingplace.com Brazilian beef suppliers are focusing on exports amid low domestic demand and reduced cattle supply, according to market experts. The country is expected to post another year of record beef exports despite a 6% drop in shipments through the first two months of the year. Brazilian beef industry association Abrafrigo, which represents small- and mid-sized beef processors, forecasts a 5% increase in the country’s total beef exports in 2021, after a record high of 2.02 million metric tons in 2020. Brazil’s beef exports should increase between 2% and 4% this year from 2020, said analyst Alcides Torres of Scot Consultoria in a video published by the consultancy last week. He said the average daily volume of beef exports has been improving since the last week of February. High cattle prices, due to reduced availability as producers rebuild their herd, and low domestic demand for beef, are negatively impacting small- and mid-sized beef processors with little or no access to international markets. Some beef processors in the Brazilian states of Goiás, Mato Grosso do Sul, Rondônia and Mato Grosso have furloughed employees due to tight cattle supply leading to record prices. Cattle prices have increased by 53% over the 12-month period ending in February, while the wholesale price for beef carcass in the domestic market increased by 42%, according to Paulo Mustefaga, president of Abrafrigo. Brazil’s three largest beef processors, JBS, Marfrig and Minerva Foods, generate most of their revenues from sales outside Brazil and have been taking advantage of the devaluation of the Brazilian currency to boost margins with international sales. The chief executive officer (CEO) for Marfrig’s operations in South America, Miguel Gularte, said in a conference call with analysts that the current low availability of cattle is a sign that producers are working to increase supply in the future.

Marfrig’s press office shared that it had put workers on collective holidays and this measure was part of the company’s production strategy and had already been scheduled for the period. It didn't say for how long workers would remain on paid leave.

A spokesperson at Minerva Foods shared that workers of its production plant in Mirassol d’Oeste, in Mato Grosso state, were put on collective holidays until March 28, 2021. The company also said the measure was part of its planned schedule to perform maintenance work at the plant. A JBS spokesman in Brazil told Meatingplace that it had no immediate plans to enforce collective holidays to workers in any of its Brazilian production plants. ■