In the United States, one trader described the domestic beef market as healthy, with domestic 90 CL remaining firm and 50 CL beginning to recover. The problem, he explained, is the sudden appearance of additional Brazilian beef volumes that were not included in the market’s normal supply program.
“If 50,000, 60,000 or 100,000 tons suddenly show up in a quarter when they weren’t expected, prices go down,” he said.
According to the source, this is a classic supply-and-demand reaction rather than a sign of weakening US consumption.
Price references continue to show a wide gap between origins. Australia concluded business into the US at US$/t 8,050 CFR for 95 CL, US$/t 7,350 CFR for 90 CL and US$/t 7,300 CFR for 85 CL, with some buyers only willing to purchase product from Australia or New Zealand.
South American values remain significantly lower. Paraguay was quoting US$/t 5,200-5,400 CFR for out-of-quota 90 CL. “The market is extremely slow,” one broker said. In Brazil, a source reported values in the US$/t 5,300-5,400 CFR range for 90 CL.
From Argentina, a broker said that with a bid of US$/t 6,500 CIF within quota, “you can buy all the volume you want.” Other sources reported references around US$/t 6,600 CFR for the same product.
One broker believes the imbalance will be temporary and that the market should begin to normalize during the second half of July, when product destined for fourth-quarter arrival starts being loaded.
“The third quarter will be challenging, but in my view it’s a short-term issue,” he concluded.
