Hear
Even though he domestic beef consumption is depressed, farm income to feedlots grew by 20% in May. The number arises from a report carried out by Rosgan that indicates that last month there was a entry of 541,707 animals, according to the DTes issued by Senasa to those destinations, about 100,000 more animals than those registered in April.
According to the latest data reported by the health organization as of the 1st of this month, The stock of animals in feedlots stands at 1,962 million heads, 12% higher than the 1,750 million reported a month ago and very close to the maximums recorded in June and July of last year, when the two million animals in stock were exceeded. “In effect, measured on the nearly 14.7 million calves and heifers registered in stock as of December 31, 2023, The May output reflects a rate of 10.4%, one of the highest rates for that month in recent years,” the report maintains.
However, for Juan Eiras, director of the Argentine Feedlot Chamber (CAF), More than the photo of the moment, you should be broader and see the entire film, especially when it has been two months with a significant leveling off in cattle entries.
“As usual, ityes numbers have a real reading and not just a first screenshot. The increase is important, but it is diluted when we look at what happened in March and April, with a notable flatness. That’s why, These three months are still below the occupancy of the previous year. And the other reality is that only 55% is calves and heifers, with which you have bulls, heifers, cows, steers and even bulls, which are the income that completes 45% of that income,” explained to THE NATION.
Usually, according to Rosgan, the highest arrivals of animals occur between March and June, coinciding with the seasonal peak of the calf harvest. But last year the lack of grass due to the drought led to an advance in the departure of animals and consequently the peak of entry to the feedlots, already reaching 582,000 animals entered in March.
With a more benign outlook, in 2024 this income curve was somewhat more delayed than usual, given that until last month income was certainly stable at around 430 to 450 thousand heads per month while and only in May did recorded the first significant increase of the campaign.
In short, “this significant increase in the current confinement of animals allows us to glimpse “a good level of supply of finished animals that should begin to come out, on average, in the next two to three months,” they said in Rosgan.
For Eiras, andThe shrinking of the fields, the appearance of frost, the end of stubble grazing for wheat sowing, the extension of wintering periods and the lowering of money (rates), They would be some of the causes of this increase in entry to the pens.
“Today, although they remain expensive, The rates have no relation to what they had 60 days ago and without a doubt that generated an impulse to look for corrals. but basically “The bulk of the income is justified at the end of the autumn grazing and stubble grazing cycle,” described.
In this scenario, he insisted on seeing and analyzing which categories make up the corrals. “There are 100,000 more heads than what we came from but Only 55% belong to the calves category. The other 45% belong to the rebred category. With which, many of that cow locked up we know where it is going [China] and the bulk of the steer in the feedlot, which is so scarce, will also go to export, which is very lacking and currently poorly supplied,” he said.
With a look at this depressed domestic consumption, the manager indicated that, in relative terms, in a current Agricultural and Livestock Market (MAG) of 13,000 heads, The price of the steer and heifer is below $2000.
“Although people don’t have enough money and a lot of meat between 6,000 and 8,500 pesos, Once again we have been very cheap. With these price levels on the counter that are apparently coming to a standstill, I don’t see a major weakness in consumption because I don’t see an increase in the value of live cattle either: a heifer at $1800 or $1900 gives very cheap meat on the hook,” he pointed.
“Consumption is not going to follow a deterioration process. The reasons? The updating of the parities and the value of the current meat that month after month will be behind inflation and other products. These activities put a price list at the beginning of the month, something that those of us who produce meat know we cannot do. We play in a global market of supply and demand, where we do not have any dominant position, just as export to which I see with little capacity to react, beyond the need due to the lack of steers”, ended.
