ANUGA REPORT - Brazil Companies Set to Grow

GERMANY - Further consolidation and more international company takeovers can be expected from the leading Brazilian meat processors, across the beef, pork and poultry sectors, writes TheCattleSite senior editor, Chris Harris.
calendar icon 13 October 2009
clock icon 2 minute read

Speaking at the Anuga Food show in Cologne, the Brazilian meat industry spelt out its intention to expand and to attack new markets.

Ricardo João Santin, the executive director of Brazilian Poultry producers and Exporters Association (ABEF) said that the recent mergers between Perdigão and Sadia and Marfrig and Seara, had highlighted certain "synergies" between the companies.

He said he believed the newly formed companies would find their own market share in different parts of the world.

"We want to compete in the same markets as others in the world, but we want to be able to choose those markets," he said.

"The companies will now be stronger to go to the new markets."

Mr Santin said that he expects poultry exports to increase by between one and two per cent over the next year in volume however, he added that because of the high value of the Brazilian Real the value of exports was not likely to increase significantly.

Last year Brazilian poultry exports were worth US$7 billion and they are forecast to rise from 3.6 million tonnes to 3.7 million tonnes.

For the beef market the exports over the last year have fallen by 20 per cent in value, but the consolidation in the industry is going to continue, according to Otávio Hermont Cançado, executive director of ABIEC, the Brazilian Beef Exporters Association.

"In Brazil, we are going to see two kinds of companies - five or six large protein companies and many small ones. These will not be affected by the growth of the large companies," he said.

He said there is little concern about the way the large companies such as JSB Friboi, Marfrig and Bertin are growing, because the banks are overseeing and financing the recognised and steady growth.

"They have a strategy to do it and they will find opportunities across the world," said Mr Cançado.

However, he added that their growth is unlikely to affect the large number of smaller processors in the domestic market.

He said that at present the three major companies in the beef market - JBS Friboi, Bertin and Marfrig have 90 per cent of the beef export market, but they only have 37 per cent of the domestic market.

He said the smaller and medium sized firms are set to remain strong on the domestic market.

TheCattleSite News Desk

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