Rabobank forecasts wheat, corn and soy prices will remain high: a challenge for US cattle awaiting processing and Brazilian cattle faced with poor pasture availability.
“Many key beef production and consumption areas across the world are currently experiencing high or record prices for beef or cattle,” said the analysts.
Strong demand and limited supplies, according to the latest Rabobank beef quarterly, are seeing cattle prices pushed to record levels. The Rabobank seven nation cattle price index shows finished cattle prices across all regions – except Uruguay and New Zealand – rose through March and April.
Argentina announced mid-May that it would impose a 30-day ban on the export of beef to alleviate rising domestic beef prices. “As Argentina supplied 22% of China’s imports in Q1 2021, this could be bullish to trade prices for beef, depending on how long the ban stays in place.”
Foodservice sales lend boost
In terms of ongoing impact from the COVID-19 pandemic, the analysts said the rollout of vaccines, and the advance of the northern hemisphere summer see many areas experiencing lower case numbers of the coronavirus, and higher economic activity also. They noted that with restrictions being eased, foodservice sales are also starting to pick up, and as the opening-up of restaurants and other catering operations continues, demand for beef should continue to grow. “On the flip side, low labor availability is starting to restrict operations at some plants, especially in the US.”
Sustainability pressure continues
There has been no let-up in pressure for greater beef industry sustainability.
“In late March, JBS, the world’s largest animal protein company, announced a commitment to achieve net-zero greenhouse gas (GHG) emissions by 2040. JBS joins a growing list of animal protein companies that have set ambitious targets for GHG-emission reductions." said the Rabobank team.