Colombia | Sowing the Future: Agriculture and Livestock - Cattle Report

Summary

Conditions are favourable for boosting sector expansion and exports. Despite low domestic growth and weakening employment, lower relative prices will help domestic demand. Externally, a real depreciation higher than that of regional peers will favour exports.

Key points

• Key points:
• The cattle herd is close to 30 million head, the 12th largest in the world and with a significant evolution since 2017. Its structure is primarily extensive, which reduces its environmental footprint but displaces potential agricultural capacity.
• In recent years, significant progress has been made in efficiency, both in terms of carcass yield and average weight per animal. This, supported by a herd sectorisation strategy, has allowed for a significant expansion of exports with growth potential.
• Locally, Colombia's growth is expected to recover gradually and still below its historical average, which together with a weakening labour market will limit the expansion of domestic beef demand in 2024. Despite this, a gradual recovery of the economy is expected in 2025, some moderation in relative prices and relative improvements in household purchasing power. Added to this is a higher real depreciation than expected in other competitors, which will support the expansion of the sector, especially towards exports.
• The climatic situation will have a short-term effect: "El Niño", with droughts that increase the slaughter of males; "La Niña", with floods that threaten the herd. We are ending the "El Niño" period and we are beginning the transition to a possible "La Niña" phenomenon in the second half of the year.

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