The world's biggest exporter of beef has 'over-killed' its national herd to meet escalating demand from China, and the ramifications will be felt world-wide.
That is the opinion of meat analyst Brett Stuart from Global Agri Trends, who has been following the amazing rise of Brazilian cattle prices this year.
Brazil is the world's largest exporter of beef and right now, its cattle prices are at record highs, and have more than doubled in the last two years.
The boom is being driven largely by the demand from China.
But China's escalating appetite for beef, now seems to be chewing into Brazil's national herd... and the ramifications are set to be huge.
One person who has been following this closely, is independent analyst Brett Stuart.
"They're idling plants, there's not enough cattle, and the prices keep going higher.
Domestic demand is weak
The weaker domestic demand doesn't explain record high cattle prices.
Cattle prices around 21 RI/kg which is around $4.78/kg (CWT)
"If you have 45 per cent of the meatworks idled, why are cattle prices hitting record highs every week? What it tells me is they simply can't find enough cattle., It's a similar situation as to what's going on in Australia right now, but for a very different reason."
"Brazil and Australia are two of the largest beef exporters world-wide and both of them are seeing production fall this year and exports fall this year, and that tightens the global supply.
"China is now the biggest beef importer in the world.
"You watch the interplay with what happens with beef
"US beef imports from Australia in January-Febraury were down over 50 epr cent from a year ago because of high prices and tight supplies
"Countries like Japan that depend on Australian beef are seing price hikes and availability problems.
"The beef price in China was record high in February, today its just 3 per cent of that high, it has enormous demand for beef and now two of their biggest suppliers are now seeing declining production and declining exports, so that's just going to further escalate teh price of global beef into 2021."
"At the moment it seems every week, Brazil cattle prices post a new record high.
"Cattle prices are at record highs, almost half of the [meat] packing plants are not running, so what does that tell us, it tells us they simply can't get enough cattle.
"It's a weird situation in Brazil and I'm still not sure how it's going to play out, but for right now, cattle supplies are extremely tight in Brazil."
"they've killed more than one crop of cattel last year, and thehy've killed the younger cattle,a nd killed heifers, trying to fill taht Chinese demand.
"So Brazil over-killed for China last year,.
"Chinese requirement for Brazilian beef is that it must come from cattle under 30 months of age, so in Brazil
In less than two years cattle prices have doubled
