In the fat cattle market, February closed lower than January. According to data from CEPEA/B3, the monthly average closed at 237.48 reais/@, a decline of nearly 4.75%MoM and 16.80%YoY. The main reason for this decline is the high supply of animals for slaughter, which did not put significant pressure on cattle buyers, who were able to negotiate lower prices.
For the month of March, the first few trading days indicate that the market is following last month’s trend. Comparing prices from the first 5 consecutive days of the month, @ is trading at 234.48 reais, down 1.41% from February. According to information released by Agriffato, meatpackers are operating with more comfortable production schedules at the start of the month—about 10 days.
Looking at the futures market, cattle are priced at 230.00 reais/@ for March 31, a certain devaluation if we compare it with the prices practiced today. For the coming months, contracts are pointing to an average of 226 reais.
Moving on to the finishing phase, data released by LAE show that finishing costs rose in February for feedlots in São Paulo and fell in Goiás.
According to the report, large feedlots in São Paulo ended February with a daily cost per head of 15.13 reais; for medium-sized feedlots, the cost was 15.51 reais. Much of this increase is linked to the rise in the cost of corn in the region. In the state of Goiás, the decline of nearly 2% was due to the drop in corn prices.
Corn
According to data released by CEPEA, the corn market is trending downward in February, with the price per sack at 62.58 reais, down 4.94%MoM and down 27.02%YoY.
In March, the market began trading in the opposite direction. On B3, the commodity rose by 0.41% compared to the previous month.
The market's main focus is now on the weather scenario that Brazil will present and what the expectations for the second corn crop will be. According to information released by Agrinvest Commodities, the year 2024 should exhibit behavior similar to 2015/2016, an El Niño year. The futures market also showed an increase for March contracts, averaging 62.65 reais/bag.