Brazil’s Beef Prices Soar on China’s Increasing Demand
Brazil’s beef prices are at record highs.
The increase is tied to China taking Brazilian beef amidst its African swine fever outbreak.
China’s imports of Brazilian meat are up about 24% through October.
Wholesale beef prices in Sao Paulo are at an all time high now with prices up 36% year to date.
Through September, U.S. beef/veal exports are down 4%.
FBN’s Take On What It Means: Given how little beef the U.S. exports to Brazil, there is limited opportunity for U.S. beef producers to see much expansion into Brazil’s market despite the rise in prices. The upside is that there is a global protein issue with shortages present in China, which is expected to overall benefit the U.S.
Marginal Increases for Soy Area in Argentina
Argentina’s exchange boosted its soy area by about 247,000 acres to 43.7 million.
The Agriculture Ministry is forecasting soybean area at 42.5 million acres, also up about 247,000 acres from its previous forecast.
Some producers switching from corn to soy can be tied to the recent election.
Producers may be hedging against potential export quotas or higher taxes.
Argentina is the world’s largest soymeal exporter.
Corn planting typically runs into early December while soybean planting may continue into early January.
FBN’s Take On What It Means: Argentina producers were expected to adjust some acreage from corn to soybeans. While the area may be light, any cut to corn production in Argentina may benefit the U.S. The added soybean area does not greatly impact the U.S. given Argentina's tax system which favors exporting meal over beans.
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