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Brazilian beef

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rancher

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Brazil meatpackers eye US



Brazil meatpackers eye US fresh beef market in 2006

By Marcelo Teixeiro

Fri Sep 9, 2005



BARRETOS, Brazil, Sept 9 (Reuters) - Slaughterhouses in Sao Paulo State, responsible for 70 percent of Brazil's beef exports, expect the United States to open its fresh beef market to the world's largest exporter in 2006.



"I think the United States will almost have to buy Brazilian beef next year," said Edivar Vilela de Queiroz, president of the Sao Paulo Beef Industry Association (Sindifrio).



"They (the U.S.) have low production and have already bought nearly all that Uruguay has to export," he added.



Uruguay is one of the few beef exporters permitted to ship fresh and frozen beef to the U.S. market.



Brazil exports cooked and processed beef to the United States in the form of corned beef for example but has long sought to open the prestigious U.S. fresh beef market.



The opening of the U.S. fresh beef market would not signify a large volume in increased exports for Brazil as it would be restricted to a U.S. fresh beef quota but it would open other high end markets such as Japan, South Korea and Canada.



Queiroz said it is a battle between the U.S. beef processor industry and the cattle ranchers in the U.S. Congress every time the consideration of Brazil's status comes up.



"The U.S. industry has a big interest in having access to Brazilian beef supplies, as they are far cheaper than those on the North American market. We could sell a good volume of beef to produce U.S. hamburgers," he said.



The U.S. government recently sent various trade missions to Brazil to visit its processing industry.



The U.S. consumer beef market is the biggest in the world and would be a feather in the cap of Brazil's expanding beef export industry.



Despite being the world's No.1 beef exporter, Brazil is still banned in 60 percent of the global beef market due to sanitary restrictions, principally due to foot-and-mouth disease.



Brazil is free of the disease but its herd of roughly 200 million head of cattle is under vaccination. Many countries require that Brazil be free of foot-and-mouth without vaccination before opening their market.



Brazil's beef exporters association Abiec said this week that beef shipments would surpass initial expectations of $3 billion in 2005.



The opening of U.S. fresh beef market "could happen. It is a possibility that always exists. Brazilian beef is cheap. They have interest in buying and we in selling," said Alcides Torres, director of Scot Consultants in the beef sector.



He added that if Brazilian fresh beef got access to the U.S. market, it would likely be successful in limited areas of the market.



Brazilian beef is cheap and very lean -- appealing to the health conscious --- but not always as tender as the U.S. feedlot fattened beef, so not best suited for some steak cuts common in the United States.



"In this way we will conquer the lower end beef market in the United States, for processing," Torres said.
 

Jason

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From that article, Brazil is a threat to Australia more than North American ranchers. Brazillian beef is not high quality. I have read many articles and although they would like to copy our feedlots etc, they don't have the climate and infrastructure to do so.

Costs of Brazzillian commodities as well is on the rise. Soybeans cost nearly $5 US per bushel at their ports. So maybe their cost of beef won't be the $.17 we have all heard spewed.
 

PORKER

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MOST important Part ,Brazil is free of the disease but its herd of roughly 200 million head of cattle is under vaccination. Many countries require that Brazil be free of foot-and-mouth without vaccination before opening their market.
 

RobertMac

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Rancher, most producers are going to stick their heads in the sand and not worry about Brazil until it bites them on the butt! :eek: :shock: :lol:


Jason said:
Costs of Brazzillian commodities as well is on the rise. Soybeans cost nearly $5 US per bushel at their ports. So maybe their cost of beef won't be the $.17 we have all heard spewed.

Jason, did I say anything about those Argentine cattle eating any soybeans...oh, yea they did...as forage! :p Keep your head in the sand...it amazes me how many open minded people think there is only one way to do things. Quality is in the eye of the beholder...or in our case, the mouth. Chicken isn't out selling beef because of quality, but is getting more consumer dollars. Tell me this, if Brazil floods our market with cheap lean trimmings and the price of ground beef is cut in half, what will happen to the price of the rest of the beef complex?????
 

Jason

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Jason, did I say anything about those Argentine cattle eating any soybeans...oh, yea they did...as forage! Keep your head in the sand...it amazes me how many open minded people think there is only one way to do things. Quality is in the eye of the beholder...or in our case, the mouth. Chicken isn't out selling beef because of quality, but is getting more consumer dollars. Tell me this, if Brazil floods our market with cheap lean trimmings and the price of ground beef is cut in half, what will happen to the price of the rest of the beef complex?????

Robert, US farmers have long been wailing about the cheap Brazillian soybeans, it never happened.

Now we are concerned about cheap Brazillian beef, it might be just as expensive if it ever does enter the US market.

Austrailian trimmings have been price positive for US producers, so if Brazil lowers that price, the US producer would be paid more for excess fat.

From the trends to lower frame size in the US excess outside fat cover is going to continue to increase.

The fact remains that Canada and the Northern States produce the very highest quality fat cattle in the world. That is a limited production area so as more consumers, worldwide get a taste for it, the price will remain at the top of what consumers will pay for. The cheap imports are good for the poorer people that can't afford the high end product.
 

PORKER

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Bunker ship fuel has doubled Jason and what was cheap to import is nolonger a talking point as local is cheaper.
 

RobertMac

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Jason, if the consumers believe the media, the educational system, the government, and the medical profession, would they consider beef with more fat in it "HIGH QUALITY"??????????? For the answer, look at the market share of the protein complex from 1970 to today!!! I agree with a limited production area, but you had better come to the realization of a limited market area also. True beef eaters enjoy the fat, but they are a shrinking market share. If we are going to expand beefs market share, we had better provide what consumers ask for and this industry has a history of telling the consumer 'to buy what we produce or buy something else'!

Quality grade is an objective decided by the industry...quality is a subjective decided by the consumer. I processed a 24 month old calf that will gross me just under $3 grand...who's idea of quality got me that price???? I'm guessing, but I'd call him a Select-YG 1 or 2.

Cheap imports will never get cheap enough to beat out chicken and aren't YG3 & 4 discounted. Cheap lean imports increase the value of fat, not the value of over fat cattle!

And you are wrong about the impact of S.A. soybeans. To believe that you would have to ignore the law of supply/demand. Not too long ago, the price of soybeans was below $5.00/bu and over double digit/bu. A sign of an industry growing production and demand! Increased and diversified usage has maintained prices.
 

Jason

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Robert, I agree100% about educating consumers on fat. Every rancher, feeder, retailer, advisor etc should know the truth about fats and that 30% of our calories should come from fat.

Our production area is shrinking due to city sprawl, developments etc. but our market is not shrinking. The world population is growing at an ever faster pace. 6 billion growing at 2% is more people than 5 b at 2%. Asia and high density areas that have developed a higher standard of living already are the emerging markets that we need.

China has huge potential. If they were to eat beef once a year even a 3 oz portion would be a massive amount of beef.

Brazil has their soybeans at the port at a cost of $5 a bushel. How will they be able to drop US prices below that cost without some form of subsidy? Same for beef. If they were to try to compete on a 1 to 1 basis, their costs wouldn't be much different than ours.

Congrats on your animal. Repeat that 50 times and you almost have a living wage, if you can keep your costs down.
 

RobertMac

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Jason said:
Brazil has their soybeans at the port at a cost of $5 a bushel. How will they be able to drop US prices below that cost without some form of subsidy? Same for beef.

The same way the price of any commodity drops below cost of production...over supply and lack of demand!
 

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