The latest BSE scare in Brazil involves a 9-year-old pasture-raised bull on an isolated property running only 160 head of cattle in Marabá, Pará. The animal was slaughtered, incinerated on site and the farm was isolated, and it has been stated that no animals have recently been turned off to market from the property, reducing the chance of any impacted animals having entered the Brazilian export supply chain recently.
While initial tests on the animal have confirmed BSE, further tests are required to determine whether it is just a case of Atypical BSE in a geriatric animal, like last time in 2021, or a more serious situation.
Brazil accounts for around 38% of China’s beef imports (January to July 2022). The last time the cases of BSE were identified in Brazil was In September 2021, Atypical BSE led to almost 3 months of suspended beef trade from Brazil to China. Overall, the length of the ban will depend on the results of the tests, and whether any other animals are found. One thing to consider though was that in 2021, China was operating in a much tighter general biosecurity environment because of COVID, and Brazil was slow to report on the instance so we may see the process move faster this time around.
Back in 2021, we wrote several articles covering the situation, and a lot of the general conclusions are still quite applicable today.
Mad Cow found in Brazil – exports suspended – Mecardo
Brazil beef banned by 5 countries on mad cow scare – Mecardo
The Eastern Young Cattle Indicator (EYCI) fell 29¢ (4%) this week to close at 722¢/kg cwt. In the West, the market made a similar move lower, with young cattle losing 23¢ to 716¢/kg cwt. The National Feeder Steer Indicator continued on a downward run, ending the week 9¢ lower at 376¢/kg lwt. MLA’s new processors cow indicator has been moving sidewards for most of February and shuffled just 3¢ lower this week with a small lift in supply.
At this week’s QLD and NSW Nutrien Livestock agents conference, there was continued discussion around MLA’s herd projections, with many holding the opinion that projections were overstating current capacity in the market. David Foote chair of Cattle Australia and Australian Country Choice Advisory Panel spoke at the event and suggested that processors were making healthy leaps towards capacity, with some of those involved in cattle processing averaging around 90% capacity.
US frozen cow 90CL prices shifted up again this week, gaining 2.9% week on week to finish the week at AU$759.96 ¢/kg on the back of continued concerns by buyers about a tighter supply outlook, and elevated domestic US beef prices last week. With the BSE scare on people’s minds this week, which may cause a suspension of Brazilian beef imports into the US also, the outlook for 90CL is rosy.
Mad Cow in Brazil & doubt on herd estimates
The latest BSE scare in Brazil involves a 9-year-old pasture-raised bull on an isolated property running only 160 head of cattle in Marabá, Pará. The animal was slaughtered, incinerated on site and the farm was isolated, and it has been stated that no animals have recently been turned off to market from the property, reducing the chance of any impacted animals having entered the Brazilian export supply chain recently.
While initial tests on the animal have confirmed BSE, further tests are required to determine whether it is just a case of Atypical BSE in a geriatric animal, like last time in 2021, or a more serious situation.
Brazil accounts for around 38% of China’s beef imports (January to July 2022). The last time the cases of BSE were identified in Brazil was In September 2021, Atypical BSE led to almost 3 months of suspended beef trade from Brazil to China. Overall, the length of the ban will depend on the results of the tests, and whether any other animals are found. One thing to consider though was that in 2021, China was operating in a much tighter general biosecurity environment because of COVID, and Brazil was slow to report on the instance so we may see the process move faster this time around.
Back in 2021, we wrote several articles covering the situation, and a lot of the general conclusions are still quite applicable today.
Mad Cow found in Brazil – exports suspended – Mecardo
Brazil beef banned by 5 countries on mad cow scare – Mecardo
The Eastern Young Cattle Indicator (EYCI) fell 29¢ (4%) this week to close at 722¢/kg cwt. In the West, the market made a similar move lower, with young cattle losing 23¢ to 716¢/kg cwt. The National Feeder Steer Indicator continued on a downward run, ending the week 9¢ lower at 376¢/kg lwt. MLA’s new processors cow indicator has been moving sidewards for most of February and shuffled just 3¢ lower this week with a small lift in supply.
At this week’s QLD and NSW Nutrien Livestock agents conference, there was continued discussion around MLA’s herd projections, with many holding the opinion that projections were overstating current capacity in the market. David Foote chair of Cattle Australia and Australian Country Choice Advisory Panel spoke at the event and suggested that processors were making healthy leaps towards capacity, with some of those involved in cattle processing averaging around 90% capacity.
US frozen cow 90CL prices shifted up again this week, gaining 2.9% week on week to finish the week at AU$759.96 ¢/kg on the back of continued concerns by buyers about a tighter supply outlook, and elevated domestic US beef prices last week. With the BSE scare on people’s minds this week, which may cause a suspension of Brazilian beef imports into the US also, the outlook for 90CL is rosy.
The week ahead….
All eyes will be monitoring the situation in Brazil. Outcomes of testing & monitoring of other cases will determine whether Brazilian beef bans will be short-term, or if there will be more serious ramifications for global beef supply for an extended period. Either way, biosecurity concerns from other countries only help to strengthen the value of Australian beef and its reputation on the global stage.
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Data sources: MLA, Steiner, Argus, Mecardo
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