The most remarkable beef price performance in 2022 has been the surge in value of Brazilian beef to over €4.20/kg equivalent this week.

While prices have been on an upward trend in Brazil since the start of the year, they have steadied in recent weeks.

However, this isn’t reflected when values are compared in Euro per kilo as Brazil’s currency, the Real, has strengthened to BRL5.20 = €1 this week, the strongest level in two years.

It was sustained devaluation in Brazil’s currency over the past decade that helped make Brazilian beef exports so competitive in international markets.

A decade ago, it took just BRL2.43 to buy €1. By September 2017, it required BRL3.24 to buy €1 and it continued to weaken, with BRL4.21 required to buy €1 by July 2019.

In January this year, the value had fallen to BRL6.40 for €1 before the recovery started.

This has a dramatic effect on the relative price of Brazilian beef in international markets. If the exchange rate today was the same as July 2019, the beef price would be €5.22/kg.

If it was at September 2017 values, it would be €6.79/kg and if it was at 2012 values, the price of Brazilian beef would be a massive €9.05/kg.

On the other hand, if we apply the exchange rate from January this year, it would bring the price back to just €3.44/kg.

With the international beef trade conducted in US dollars, against which the Real has increased by a similar value, Brazilian beef exports are coming under pressure because of cost.