Cattle prices are continuing to rise in Brazil with steer price just under €3.50/kg. This is driven by a combination of rising beef prices and a recovery in value by the Brazilian real (BRL).

At the beginning of June last year, the value of beef in Brazil was the equivalent of €2.27/kg and the market has improved by the equivalent of 20c/kg over the past 10 days.

With Brazil accounting for 2m tonnes, or 20% of all beef exported globally, this is welcome news for all beef exporting countries.

The growth in Chinese demand may be levelling off but shows no sign of falling

No doubt they are benefiting in recent weeks from the absence of Argentina from global export markets and the reduced supply available from Australia as they continue herd rebuilding. The other key variable is global demand and China set the pace here accounting for 2m tonnes or 20% of all beef imported in the world. The growth in Chinese demand may be levelling off but shows no sign of falling so that is positive news for Brazil.

Brazil stands to pick up markets from Argentina who are reported to be putting a cap on beef exports once the total ban finishes.

UK meat industry

As well as concerns about the Australia trade deal, the British meat processing industry in struggling with access to labour and transport.

COVID-19 has made it worse with some staff on the vulnerable list and barmen commanding salaries of £26,000

The British Meat Processors Association(BMPA) told the Irish Farmers Journal that their member factories are down 10% on labour as the reopening food service sector increases demand for butchers.

COVID-19 has made it worse with some staff on the vulnerable list and barmen commanding salaries of £26,000 (€30,250) is putting wage pressure on the sector. All of this this is further complicated by transport difficulties caused by a shortage of lorry drivers.

These are the immediate issue for the BMPA as they contemplate the imminent arrival of Australian beef and sheep meat imports.

After Australia, what next?

The front loading of Australian access to the UK market for beef and sheepmeat has taken the industry and farming by surprise.

New Zealand beef will look forward to having the UK as an alternative market to the USA and Asian markets

For the Australians, the trade deal with the UK is everything they hoped for.

The question now is what happens next. Quite quickly, a deal with follow with New Zealand and we can expect equally favourable terms of access.

Less Australian and Argentinian beef increases demand for Brazilian beef.

It won’t be necessary to be as generous with the sheepmeat access given the huge 228,000t quota already shared between the UK and EU, but New Zealand beef will look forward to having the UK as an alternative market to the USA and Asian markets.

Canada

With the UK focused on the Pacific Partnership countries, we can expect that Canada will be quickly pursuing a renegotiation of the EU deal that was rolled over by the UK earlier this year. The Canadians will have a strong focus on beef access as they are not a sheep meat exporter – in fact they are the most viable export market outside the EU for Irish and British companies exporting sheep meat.

The focus for Canadian negotiators won’t so much be achieving unrestricted volume access as that will now be the base line but standards.

It is unclear if the UK have relented in this respect with Australia but it is a major issue for Canadians.

It is their main grievance with the EU and disquiet in Canada with the CETA deal with the EU which they believe is a great deal for Europe but not Canada.