Brazil cuts cattle harvest as export challenges mount

Brazil's federally inspected cattle harvest totaled 14.4 million head in the first half of 2026, down 1.3% from the same period in 2025, according to preliminary data released by the Ministry of Agriculture and Livestock (Mapa).

Market participants said harvest levels could decline further in the coming months as the industry adapts to a more challenging environment for Brazilian beef exports.

Mapa data showed first-half harvest volumes were also 8.9% lower than in the second half of 2025.

Market participants said harvest levels were expected to continue to decline through the third quarter, with lower beef production emerging as one of the industry's strategies to mitigate the impact of a more difficult export environment amid trade restrictions and the prospect of losing access to key markets.

The end of the tariff-free beef export quota to China is one of the main challenges facing the domestic industry, given China's importance to Brazilian beef shipments, according to a Brazilian exporter.

Data from Brazil's Foreign Trade Agency (Secex) showed that China accounted for 51.8% of Brazil's beef exports in the first half of 2026.

The exporter also said the European Union's decision to close its market to Brazilian animal protein products over sanitary requirements related to antimicrobial use in animal production was another source of concern. The measure was scheduled to take effect Sept. 3 and was expected to primarily affect hindquarter beef cuts, the source said.

There are currently two ways to mitigate the impact of reduced access to the Chinese and European markets, according to another exporter. The first is to increase beef supplies to alternative destinations, such as the Philippines, several Middle Eastern countries, Chile and even the US, although at lower prices than those achieved in China. The second is to reduce beef production, which involves lower cattle purchases by the industry and, consequently, lower harvest volumes.

The source said harvest levels over recent weeks were already down nearly 30% and could decline further if export prices or domestic beef values fall more sharply than expected.

Researchers at the Center for Advanced Studies in Applied Economics (Cepea) said tighter supply has been one of the factors limiting declines in Brazilian fed cattle prices. An industry participant said this situation has also led to higher offers for new trades of Brazilian beef in alternative markets.

Higher offer levels were supported by rising Brazilian fed cattle prices and reduced cattle availability for harvest, according to the source.

The Platts Brazil Beef Marker was assessed unchanged at $5,320/metric ton FCA Santos July 28 amid no disproving indications.

Although lower production has partially supported Brazilian fed cattle prices and limited steeper declines in export prices, another industry participant said harvest levels were likely to increase again once sales for China's 2027 quota resume.

"The market will change when China reopens," the source said.

Platts is part of S&P Global Energy.