Manufacturing beef markets are coming under increasing pressure as Brazil redirects more product to alternative destinations while approaching the exhaustion of its annual beef quota for China.
According to traders quoted by Beef Central, the greatest impact is being felt in the frozen lean trimmings segment, where Australian beef competes directly with Brazilian product, particularly in the US market.
Prices for imported lean beef in the United States have been trending lower from this year's record highs. According to MLA, the price of Australian 90CL grinding beef exported to the US fell to A$/kg 11.06 in the week ending July 3, down 8% from its April peak. Traders attribute the decline to the rapid increase in Brazilian supplies. While fresh domestic US 90CL beef is trading at around US¢/lb 463, Australian frozen product is quoted at US¢/lb 360-365, compared with about US¢/lb 315 for Brazilian beef.
Exporters estimate that Brazil is now shipping more than 50,000 tonnes of beef per month to the United States, surpassing Australia's volumes. As China's purchases slow following the exhaustion of import quotas, market participants expect even more Brazilian beef to be redirected to the US, increasing competition and adding further downward pressure on manufacturing beef prices. However, the recent slowdown in Australian slaughter is expected to partially limit exportable supplies in the coming weeks.
Another key uncertainty remains China's policy on bonded cold storage. If Beijing allows imported beef to be stored in bonded warehouses late this year and released after January 1, 2027, Chinese buyers could resume purchasing Australian beef as early as October. If not, traders expect buying to be delayed until only a few weeks before year-end, allowing shipments to arrive after the 2027 quota becomes available.
Source: Beef Central
