Highlights:
- Drought continues to push more US beef cows to market. Cow and bull slaughter is currently running at levels that we normally see in the fall. Despite the liquidation so far, we could inventories decline further due to high feed costs and lack of forage this coming winter.
- South American beef exports have exploded, in part because China is looking to refill its pipeline. What stands out from our recap of major exporting and importing countries is the imbalance in
exports. This suggests, in our view, that more beef will be going to smaller importing countries in
addition to the big five. - Exports from Argentina were sharply higher in June, but we still expect them to decline for the year.
- Brazil is expected to export 15.5% more beef in 2022 than the previous year. It should be noted
that last year Brazil’s exports were curtailed by BSE and Chinese suspension. The recovery in Brazilian
exports is a big part of the reason for the increase in exportable supply this year. - New Zealand continues to ship more beef to China, which could represent about 44% of New Zealand
export share in 2022. US market share connues to shrink, especially as more volume is now
going to Japan and S. Korea. - China beef imports ballooned in June, up 43% y/y . Likely making up for the lack of imports seen
January‐April due to COVID lockdowns.
