28 February 2023

Since late last week, the Brazilian government announced the suspension of beef exports to China, as established by the sanitary protocol between the two countries, after the confirmation of a case of mad cow disease (BSE) in a 9-year-old animal in the state of Pará.

 

The duration of this suspension is key to knowing to what extent it will be a disruptive factor in the market. The protocol says that it is four weeks, but in 2021 it was extended for three months and was the main factor that caused the upward spiral of export prices during the first months of 2022. The rise between January and the peak of June 2022 was of the order of US$/t 1,000, or 19%.

That the suspension of Brazil is bullish for export prices to China is beyond doubt. In December, Brazil was the source of 48% of the beef that arrived in China, while Mercosur accounted for 3 out of every 4 kilos imported.

The expectation is for Chinese demand that tends to improve after having left the zero Covid policy behind. GDP is projected to grow 5.2% this year, according to the IMF, clearly above the meager 3.0% of 2022. One of the key sectors in this recovery is retail sales and, among them, sales in the category of hotels and restaurants, where beef demand tends to be buoyant.

Therefore, the expectation is that demand will be firm. In fact, it was already showing signs of recovery in the first weeks of the year. In this context, the suspension of beef exports from Brazil has the capacity to boost export prices, as long as the measure is extended for a reasonable time.

關於亞太區皮革展 ​

我們為皮革、物料及時裝業界創造面對面洽談的機會,爲客戶締造實質商機。我們雲集世界各地的商家,讓他們尋找新的合作伙伴,發掘潛在客戶或供應商,並掌握業界最新發展。

 

我們主辦多個專注時尚及生活潮流的商貿展覽會, 為這不斷變化的行業,提供最全面的買家及參展商服務,方便他們了解急速轉變的行業環境,並預測來季趨勢。

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