The price of grains such as corn and soybeans increased, so the meat prices worldwide has been impacted.

Grain prices increased

The price of grains in the stock exchange increased for this week of May 2021, according to figures from the Chicago Stock Exchange. Experts report that grains are at their highest price since 2013.

Multiple analysts agree that the cause of the increase in corn prices has two important factors. The first is the drought that is currently affecting Brazil’s agricultural sector. Brazil is the third-largest corn producer in the world, producing 109 million tons per year. It is expected to be the second-largest corn producer in the world by 2021.

The second factor affecting grain price increases is the U.S. winter. During the first months, grain crops suffered freezing temperatures that generated losses. In addition, production has been implemented slowly during the first half of 2021. The United States is the largest corn producer in the world, followed by China.

Meat price situation

The price of grains has an impact on global meat prices. Feed is the most expensive input in any animal production system. Therefore, increases in the price of grains, such as corn and soybeans, have a strong impact on the stability of the meat business.

The price of beef and sheep meat increased due to high demand from East Asia. The president of Argentina, Alberto Fernández, announced the suspension of beef exports for 30 days. With this measure, the Argentine government hopes to stabilize domestic prices.

The price of pork increased due to the price of grain, which constitutes 60% of production costs. It was also boosted by strong demand from East Asia. On the other hand, the eastern pork market has been affected by outbreaks of African Swine Fever (ASF).

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The price of poultry meat and eggs has remained relatively stable, despite increases in feed inputs, such as corn. However, due to market dynamics in some producing regions, production costs remain high.

Some analysts say that this rise in grain prices could last for several months. The COVID-19 pandemic has also affected the market by increasing costs of labor and services.