LAST Saturday, Brazil's Agricultural Defence Secretariat of the Ministry of Agriculture, Livestock and Supply (MAPA) confirmed the occurrence of two atypical cases of Bovine Spongiform Encephalopathy (BSE) in slaughterhouses in the states of Minas Gerais and Mato Grosso.
The cases were suspected earlier in the week and confirmed by the reference laboratory of the World Health Organisation for Animal Health (OIE) in Alberta, Canada on Friday, September 3.
This advice was contained in a clarification note issued by the Ministry which asserted there was no risk to human and animal health.
Atypical BSE, it said, occurs spontaneously and sporadically and is not related to ingestion of contaminated food.
These are the fourth and fifth cases of atypical BSE reported in more than 23 years of surveillance for the disease and Brazil has never registered the occurrence of a classic BSE case.
The reason, therefore, that the matter has received such widespread media attention is the trade suspension in Brazilian beef exports to major market China that has occurred in compliance with the sanitary protocol between the two countries on the BSE issue.
The suspension in trade took effect on Saturday and will remain in place until the Chinese authorities complete their assessment of the information already passed on.
Return to trade will be at China's discretion.
Brazilian Association of Meatpackers, Abrafrigo, noted that the last time a similar suspension in trade with China occurred in mid-2019, shipments were under way again in less than two weeks.
The drop in the price of live cattle on that occasion was reportedly contained at 3.6 per cent.
However Brazilian beef exports to China have increased dramatically since then to the point that China and Hong Kong combined are now reported to account for almost 60pc of Brazil's total exports.
From China's perspective, this development is magnified by Argentina's export controls which currently restrict beef volumes to 50pc of last year's average monthly volumes.
Given the extent to which China has become dependent on South American supply and the precedent established for a rapid return to trade when suspension was similarly invoked in 2019, it would seem highly likely that the matter will be resolved within a matter of days.
August beef exports plummet
BEING another 22-day working month, August might have been expected to match the beef export tonnage of previous month July except for the fact that August and September are typically the hardest months of the year for cattle supply.
While Queensland meatworks somewhat surprisingly held to five-day weeks, the situation in southern states was marked by a considerable amount of lost time.
In consequence, August export volume fell by 4000 tonnes to 77,150t.
This is the lowest August volume in the past 10 years (and possibly a lot longer) but it only just eclipses last year's figure of 78,000t.
On a progressive basis for the eight months to date, Australia's exports to all destinations amount to 580,732t, by far the lowest count in the past 10 years, with 2012 the nearest at 613,000t.
With prospects for September looking no better than August, the final quarter will have to step up to around 81,000t per month in order for the full calendar year to reach just 900,000t.
Historically, 81,000t/month is not a big number but this year it has only been exceeded once, in March, and then by only a couple of thousand tonnes.
The question this poses is whether the cattle are there for a final-quarter surge, however slight.
2016 provides some insight insomuch as it was a wet-winter year.
It recorded a November/December surge in slaughter numbers but largely because the rain extended late into winter and the country only dried out enough by October for stock movement to get properly under way.
2012 had a big final-quarter surge but this came at the end of a three-year run of strong, herd-rebuilding years.
By comparison, 2021 is currently less than 18 months into rebuild and so far the winter rain this year has not interrupted transportation of cattle.
Feedlots would seem reasonably well placed with numbers to maintain consistency of supply, which leaves traditional grassfed ox and cows to determine the rest of the supply picture.
For their part, cows might be expected to become even scarcer than they were in the first half of this year.
In last quarter of 2020, ABS data had the percentage of females in the kill at 48, down from 56-57pc mid-year.
First quarter of this year showed a further drop to 45-46pc but then surprisingly, it climbed to 48pc in the second quarter.
Perhaps that was an indication there was still more than enough country on the dry side.
If so, then the recent good rains in central/north Queensland coupled with the Bureau of Meteorology's outlook for above median rainfall in September to November may relieve the pressure on those areas and bring about a further reduction in the female component of the kill.
For grassfed ox there is confidence some will come forward from traditional areas but how many instead have already gone to feedlots is the unknown.
Meanwhile with the exception of largest market Japan, other major destinations have been consistent in shipping similar monthly volumes in the 12,000-14,000t range.
The difference, however, is that these monthly volumes will keep Korea on track to match last year's total annual tonnage while leading China to a 25pc reduction and the US to its lowest level of beef imports from Australia in at least the past 20 years.
Japan's 3700t drop on previous month stands out but probably only because July was an uncharacteristically high month. The August volume of 20,466t was actually up on same month last year which is the first time that has happened this year except for July.
In secondary markets the Philippines took an extra 1100t and the Middle East an extra 500t.
The story Quick resolution to Brazil/China beef trade suspension expected first appeared on Farm Online.