A major source of cheap beef ebbs

Cheap beef may soon become further out of reach.

- BY DAYANNE SOUSA

Brazil, one of the world’s few remaining sources of abundant cattle, is heading into a period of shrinking supplies that could push global prices higher.For the last two years, a surge in Brazil’s beef production has helped fuel a jump in exports. That’s as ample herds drove cattle prices lower compared with other regions, and ranchers were encouraged to send more animals to slaughter. At the same time, countries such as the U.S. struggled with high food costs and sought out sources of cheaper beef.

That cycle is turning, with effects that will ripple through global markets and hamper President Trump's efforts to bring down beef prices.

Climbing prices for calves in Brazil are signaling the start of a new phase, in which ranchers start holding back female cattle to rebuild herds. The practice, known as heifer retention, reduces the number of animals sent to slaughter and marks the beginning of a tightening supply cycle.