Favourable exchange rates, government support for cattle productivity and expansions to feedlot systems are just some of the reasons Brazil is setting a world-leading pace in beef exports.

Brazil ban expected to have limited impact on Australian beef

According to MAPA (Brazilian Agriculture Ministry), the US government has decided to allow imports of chilled and frozen beef from Brazil, following long term negotiations dating back to 1999.

Recent bi-lateral discussions between the two countries resulted in Japan resuming imports of heat-processed beef from the South American supplier, as well as gaining market access for beef exports to the country.

Brazil has been cleared to supply beef to Indonesia – the world’s 8th largest beef export market and Australia’s 5th largest in 2018.

Brazil has recently been granted conditional import access to China, with eight abattoirs approved for export. This was closely followed by the announcement that Brazil would also have access to the US. This is good news for the Brazilian beef industry, but some key questions arise, including where will the beef come from and what does this mean for Australia’s beef industry?

Brazil is the world’s largest beef exporter and, therefore, has a significant impact on global exported beef demand. Livestock pricing is heavily influenced by supply and demand dynamics. This means cattle prices in Brazil greatly affect the global competitiveness of Australian beef.

Led by Brazil and Argentina, beef exports out of South America continued to expand in the opening two months of 2019.

Changing market dynamics in both Australia and the US has seen a lift in finished cattle prices, whereas prices in Brazil have remained largely unchanged.

The value of Australian exports declined by 11% last year to sit at $US6.64 billion, with Brazil eclipsing both Australia and the US to be the world’s most valuable exporter.