Supply pressure building in major world beef markets

It’s been a positive start to 2018 for the global beef sector – with production and consumption up and prices generally favourable – however, building pressures in some of the world’s major beef-producing nations have the potential to change export market dynamics, with implications for New Zealand, according to a recently-released industry report.

In its Beef Quarterly Q2 2018 – Production continuing to Grow, but Supply Pressure Starting to Mount, agribusiness banking specialist Rabobank says supply pressure is growing in global beef markets due to dry weather conditions in the US, a surplus of animal protein in Brazil and changes in live cattle trade out of Australia.

Report co-author, Rabobank New Zealand animal proteins analyst Blake Holgate says the degree to which these supply pressures continue to build will determine the extent of their impact on global markets.

“Each of these factors has the potential to cause major disruption to global beef trade flows and to drive global beef pricing lower. In coming months beef producers here in New Zealand and internationally will be hoping for developments that relieve these pressures and ensure beef markets remain balanced moving into the second half of 2018,” he said.

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