Brazil's Dairy Prices Rise Amidst Decline in Other Protein Markets

In the Brazilian market, dairy products have shown a notable increase in prices, contrasting with the decline observed in other protein segments. According to data from DATAGRO, the price of UHT milk increased by 2.1% in the past week, reaching R$ 5.37 per liter in the wholesale market. This rise is attributed to a more restricted supply of raw materials, a common occurrence during periods of reduced production in key dairy regions.

The price increase in the dairy sector is further supported by the rise in mozzarella prices, indicating a broader recovery in the prices of dairy derivatives at the beginning of July. This trend stands in stark contrast to the performance of other protein markets, where pork, chicken, and eggs faced downward pressure. Pork prices decreased to R$ 8.55 per kilogram, chicken to R$ 7.23 per kilogram, and eggs to R$ 142.26 for 30 dozen.

Meanwhile, the beef market presented a mixed scenario. The price of fattened cattle saw a slight increase of 0.26% in São Paulo, reaching R$ 327.59 per arroba, following a previous decline of 1.50%. The wholesale price of beef carcasses remained stable at R$ 23.25 per kilogram.

As the Brazilian dairy market enters the second half of the year, the availability of supply remains a critical factor to watch. The progression of the dry season in production areas and the pace of domestic demand will likely influence future price movements.

DATAGRO's analysis suggests a less uniform protein market, with each sector responding differently to supply and demand conditions. For the dairy industry, the recent price increases offer a new perspective on pricing behavior for the upcoming months.