Reason is simple: high feed costs + low farmgate prices got farmers wondering about the motivation to supply the market...So they either kept the cows or sent them for slaughter at a time of high arroba prices...
Also a watered down version of the normativa 51 means milk quality will remain a key brake for a few more years, making a return to exports very improbable.
http://www.pecuaria.com.br/info.php?ver=11727
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