Porto Alegre, September 23, 2020 – The second half of 2020 has been marked by a consistent upward movement in all the meat industry in Brazil. The fact is that the scenario of supply restriction, added to the impressive flow of shipments, put prices along the production chain at another level. From January through August, China has already imported around 779 thousand tons of beef in carcass equivalent, occupying a market share of approximately 41% of Brazilian shipments. Chinese importers have already increased the purchases of Brazilian beef by 150% in 2020. The trend for the last quarter is to maintain the good pace of shipments.
For the year 2021, the Brazilian market will continue centered on exports, with the expectation of a very strong presence from China in Brazilian shipments. Logically, the growth in 2021 will not be of the same proportion as the growth in 2020, but just the repetition of the figures for the current year would be enough to keep prices at a high level in the domestic market. The trend is for Brazil to export around 3.16 million tons of beef in carcass equivalent next year, nearly 4.5% higher. For the current year, the expectation is that the shipments will reach 3.03 million tons in carcass equivalent.
For production, the expectation is for slight growth in 2021, given the trend of a slight increase in slaughter. Next year, around 8.81 million tons of beef must be produced, up 1.28%. With this, we reach the internal availability of 5.68 million tons, down 0.4% from the same period last year.
Prices tend to remain at a very prohibitive level in 2021, reinforcing the trend of consumption migration to more affordable proteins, mainly chicken. It is very important to mention that the supply gap formed by the ASF is temporary, at some point China will resume its domestic production and reduce the pace of imports. The Brazilian meat industry needs to be prepared for this moment, seeking new destinations for Brazilian animal proteins. An occasional change in the pace of Chinese purchases would be particularly harmful to beef and pork. Chicken has less dependence, with halal chicken as a major differential for Brazil.