World Crisis Putting a Brake on Brazil’s Cattle Industry

Brazil Feedlot The plans in Brazil are to increase the number of cattle in feedlots by 4.6%. which would be equivalent to a total of 1.673.500 heads, according to Beef Point, a Brazilian portal linked to the meat industry.

The number is the result of a survey among the top 50 Brazilian companies involved in feedlots and which last year fattened 1.599.465 cattle, which represented a leap of 27% over 2007 but below the 34.5% of 2006.

The survey showed some companies are not planning to increase the number of cattle in feedlots while others are thinking in reducing them.

Goiás in central Brazil is the state which leads in feedlots, followed by São Paulo, Mato Grosso, Minas Gerais and Paraná. Most of the production of feedlots is delivered to abattoirs between August and December.

The crisis suffered by the Brazilian meat packing industry, as a direct consequence of the world recession has triggered big changes and consolidation in the industry, while livestock companies and ranchers are looking for ways to cut risks when the moment of sale comes.

Feedlots became quite popular in 2004 when the boom of beef exports, (Brazil is the world's leading meat exporter), and livestock prices began increasing. Something similar happened in neighboring Argentina, but costs have become tighter and so have profit margins.

In related news. Chile has again opened its borders to Brazilian beef. The announcement was done by Brazilian Agriculture Defense Secretary Inácio Kroetz and Brazilian Beef Exporters Association Otávio Cançado following a visit to Chile.

In 2007 because of the foot and mouth disease outbreaks in Brazil, Chile banned beef imports from that country. Brazil since 2004 had become Chile's main supplier of beef totaling US$ 220 million annually, equivalent to almost 80% of the market.

Mercopress

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