Rising beef exports
As global beef production is expected to increase by 1.3 million tonnes in 2018, competition in global markets is set to become stronger in this year.
According to Rabobanks latest Global Beef Quarterly report exports will become more critical and shift the balance of power in favor of importers.
This expansion in global production will come out of all major producing areas, specially from Brazil and the United States, two countries that will see the biggest increases in beef exports this year.
For example, beef exports are expected to increase by 7% for the United States in 2018 as their cattle herd expands for the third consecutive year, beef consumption is also expected to increase, but it will not keep up with its production growth and exports are expected to grow to 12%.
Given the low cattle supplies and producers, seasonal conditions are expected to drive large swings in prices into the first half of 2018.
Also, Brazil was anticipated to increase its export program by 5% in 2018.
According to Rabobanks senior animal proteins analyst, Angus Gidley-Baird, Brazil is actively accessing new markets and increasing their presence in existing markets, with plans to accredit 11 additional meat plants to access the Chinese market.
He also said Brazil would have 27 beef plants capable of accessing the Chinese market.
The competition to supply beef to China will become particularly fierce.
China's import demand will be critical to balance the increase in world exports.
He finished telling that China is expected to increase its import requirements to 800,000 tonnes of beef.