The Uruguay Weekly Cattle Report for December 7, 2016
By Patrick Archer and Eduardo Blasina
MONTEVIDEO – The Uruguay fat cattle market is coming off the highest monthly slaughter total in over six years. The November slaughter total was 217,076 head, the highest since the 252,743 head recorded in December 2010. The November total was 12.5% higher than the October total, and almost 10% higher than the same month in 2015.
YTD 2016 slaughter is now 2.04 million head or 1.2% more than at this same point in 2015. We are now forecasting full-year 2016 slaughter of 2.204 million head adding in an estimated 167,900 animals in December compared to the 191,600 processed in December 2015.
Up until now, the Uruguay cattle slaughter breakdown in 2016 has been quite different from 2015. Last year the total number of steers and heifers processed were almost equal with 1.081 million steers (49%) vs. 1.077 million heifers (48.8%). This year, the balance has tipped decisively toward heifers with 47% of the total (1.029 million) compared to steers with 44.5% (979,040). (Full Story in Spanish)
Uruguay Cattle Market Prices
Average prices are lower this week given the rush of supply to market creating both weekly and monthly slaughter records, writes FarmsUY co-founder Eduardo Blasina.
The average steer price being offered by meatpackers is US$2.75 per kilo on-the-hook with a maximum price of US$2.80 being offered for the best lots. For heifers, the average price this week is US$2.50 per kilo with the best animals fetching closer to US$2.55 per kilo.
In their weekly report, the Uruguay Cattle Brokers Association (ACG) said the combination of record slaughter numbers and longer supply lines at plants nationwide is beginning to slow down the pace of closing new deals here in the final month of 2016.
In the same report, the ACG lowered their reference price for steers 2.76% to US$2.82 per kilo on-the-hook while heifers lost 2.54% to US$2.69 per kilo.
There is a similar situation in the Uruguay sheep market in terms of lower prices and fewer deals being closed between plants and producers. The ACG report says there is a market preference for unweaned lambs which are fetching an average price of US$3.58 per kilo on-the-hook. The ACG reference price for heavy lambs remains at US$3.30 per kilo, while the reference price for sheep fell 1.39% to US$2.83 per kilo.
Uruguay Weekly Slaughter Activity
Weekly cattle slaughter rose for the fourth consecutive week reaching a total of 55,766 head, the highest weekly slaughter recorded since December 2010. The weekly total was 7% higher (3,900 animals) than the week prior and 16% higher than the same week in 2015.
Total weekly slaughter of steers was 28,961 head, a 7% increase over the previous week and 30% higher than same week in 2015. This was the second straight week that the steer total was greater than the heifer total.
Total weekly slaughter of heifers was 25,810 head, a 9% increase over the previous week and 5% higher than the same week in 2015. This was the highest heifer total recorded since June of this year.
In terms of weekly slaughter, Tacuarembó was the top meatpacker with 4,373 animals just barely nudging out Breeders & Packers Uruguay (4,372) and Canelones (4,135) in third place. Las Piedras processed the most steers (2,953), while Canelones handled the most heifers (2,290).
In the sheep market, total weekly slaughter rose 1.5% to 35,105 head. Weekly lamb slaughter rose another 5% to 26,525 head which is 6% more than the same week in 2015.
In terms of activity, San Jacinto led all plants with 9,023 animals followed by Las Piedras (7,088) and Chiadel (4,078) in third place. Las Piedras processed the most sheep (1,015), while San Jacinto handled the most lambs (8,081).
Uruguay Meat Export Activity
The National Meat Institute (INAC) weekly reference price for Uruguay beef exports closed at US$3,290 per ton with a total of 8,578 tons shipped with a total value of US$28.221 million. The average beef export price accumulated year-to-date is now US$3,400 per ton compared to US$3,797 this time last year.
The National Meat Institute (INAC) weekly reference price for Uruguay sheepmeat exports closed at US$3,591 per ton with a total of 426 tons shipped with a total value of US$1.53 million.The average sheepmeat export price accumulated year-to-date is now US$4,188 per ton compared to US$4,649 this time last year.
Argentina Kobe Beef Consumption On the Rise
Fifteen years after the first animals arrived from Japan, Argentina Wagyu production and Kobe beef consumption has been slowly expanding.
VIP Meat: The Japanese Breed That Attracts Demanding Palates is the headline of Mauricio Giambartolomei’s well-researched analysis of the growing popularity of both Wagyu cattle and Kobe cuts in Argentina.
The author says that current Wagyu production in Argentina is 2,250 head which includes 250 pure animals and the remainder have been crossed with Aberdeen Angus. That number, he says, proves how unique this market is when you consider there are 53 million head of cattle in the country.
The La Nación article comes complete with a very entertaining ten-minute video featuring interviews with Argentina Wagyu producers, Kobe meatpackers, Japanese cultural officials and chefs from one of the finest Asian restaurants in Buenos Aires, Osaka. (La Nación)
On a related note, Canal Rural’s Kellen Severo has an interesting interview this morning regarding the luxury beef market and the evolution of Wagyu in Brazil since its introduction in 1192. A kilo of Wagyu filet in Brazil costs around R$1700 (US$500). (Canal Rural)
Brazil Meat Exports Down in November
Brazil meat exports were down 24.1% in November compared to the same month in 2015, according to new numbers from the Ministry of Industry, Foreign Trade and Services (MDIC).
For the month of November, Brazil exported 75,800 tons of fresh beef or a daily average of 3,800 tons. November beef export revenue of US$336 million was also 23% below the beef export revenue received in November of last year.
Despite the one-month decline, Brazil beef exports YTD are up 1.6% compared to this time last year. Between January and November, the country exported a total of 990 thousand tons of fresh beef. MDIC says that number is a little below the forecast made at the beginning of this year.
There was a bit more optimism in January that 2016 sales would rebound in major export markets hurt by economic crisis in 2015, specifically Russia and Venezuela. (Canal Rural)
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