The latest USDA/FAS report forecasts a 2% growth in global production of beef and veal in 2021 and a 3% increase in the volume of the product traded.

Of the major producing and trading nations, the US, Brazil, India and Canada are all expected to increase output, while Australia and Argentina are expected to be slightly below this year as they focus on herd expansion.

This will also be reflected in trade as Argentina, which has had year-on-year increases in export volumes since 2015, will taper off, as will Australia due to restricted production.

Brazil on the other hand is projected to return a third year in a row of record beef exports in 2021, driven by demand from China in particular.

The United States is forecast to remain the world’s biggest beef producer at 12.5m tonnes, followed by Brazil on 10.5m tonnes and the EU on 7.7m tonnes. China is forecast to produce 6.9m tonnes, much less than it now consumes and then there is a gap back to India on 3.9m tonnes and Argentina on 3.1m tonnes.

Trade

The US is the biggest beef producer and is also forecast to be the second largest exporter of beef in 2021 after Brazil at 1.4m tonnes.

Coincidentally, the US is also predicted to be the second largest importer as well, also taking in 1.4m tonnes, exactly the same amount as it will export.

This is because Americans consume more forequarter beef in burgers and other dishes that use cheaper cuts of beef than they produce and they have a surplus of steak meat which they export.

Impact of China

Chinese demand is also forecast to increase again next year to 2.850m tonnes, a relatively small increase compared to recent years of 100,000t.

This is twice the amount of the next largest importer, the USA, and four times the 761,000t imported in 2016.

Demand growth from China has provided a plan for rapid expansion in exports by Brazil and Argentina in the past five years.

Argentina

In 2016, Argentina’s beef exports were 209,000t an artificially low level because of export tariffs imposed by the government. When these were dropped after a change in government, exports have increased year on year and are projected to be 810,000t this year, dropping back to 770,000t next year.

A collapse in the value of the Argentinian peso from ARS 10 = €1 at the end of 2015 to ARS 92 = €1 today has also facilitated export growth as well as Chinese demand.

Brazil

The trend with Brazil has been similar with beef exports increasing from 1.7m tonnes in 2016 to a predicted 2.7m tonnes next year. Again the combination of Chinese demand and weakening currency though not to the extent of Argentina, have fuelled this increase.

The Brazilian Real (BRL) was trading at BRL 3.23 = €1 in March 2017 but is now worth half that value at BRL 6.74 = €1.

Note: all weights in US tons, carcase weight equivalent.

Webinar

The Irish Farmers Journal is hosting a webinar titled: Sustainability and Agri-food – the next decade on Tuesday 3 November at 3pm. Featuring Tom Arnold, chair of the Irish 2030 Agri-Food Strategy Committee along with Tara McCarthy of Bord Bia, Dr Mark Lyons of Alltech and Juan Aguiriano of Kerry Group.

Submit your questions to our panel by emailing webinar@farmersjournal.ie or send to 086-836 6465.

You can view the webinar FREE at www.ifj.ie/2020vision

2020 Vision is supported by Bord Bia, Alltech and Kerry.