Meat industry starts to face the first impacts of social isolation amid the coronavirus pandemic

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The meat industry starts to face the first impacts of social isolation amid the coronavirus pandemic. Basically, the pattern of consumption shows substantial changes, and this is not exclusive to Brazil. Social isolation also strongly affects major Brazilian trade partners, such as China and the European Union. Concerns grow as some slaughterhouses report their cold rooms are full.

Notably, beef has a higher added value compared to its competitors. Moreover, the closing of restaurants and other establishments systematically reduces the demand for noble cuts. With an occasional deepening of the economic recession, average consumers will likely choose cheaper proteins, which is precisely the case of chicken. This premise also applies to the international market. In this respect, beef tends to suffer the greatest impact in the midst of the severe recessive process that must mark the current year and the year 2021. Therefore, some price decline is expected in the meat chain.

For exports, the scenario is also of concern for Brazilian beef. There is an evident flow difficulty to the European Union, while China tries to renegotiate import contracts with meat-packers in South America. China continues with a clear deficit of production, which is undoubtedly the great point of optimism at this time. The Asian country is gradually removing restrictions in the areas most affected by the pandemic. Logistics present relief and approaches normality.