AHDB foresees challenges for the Brazilian pork industry
According to Mr. Wyatt, in the last 10 years, Brazil reported an increase in pork production from 3 million tonnes per year to over 3.75 million tonnes in 2017. There is a significant share of production that is consumed domestically and up until 2015 around 400-500 thousand tonnes of fresh/frozen pork was exported annually. This increased to 629 thousand tonnes in 2016 and was 593 thousand tonnes in 2017.
Furthermore the AHDB analyst explained that last year Russia was once again Brazil’s largest pork market, taking 43% of Brazilian pork exports.
"Since 2012 Russia’s share of the Brazilian export market has grown from 25%, partly due to Russia’s widely reported ban of pork from many other countries. Interestingly, since 2012, China’s share of Brazilian pork exports has increased from 1% in 2012 to 8% in 2017, peaking at 14% in 2016. This has led to China jumping up to become Brazil’s third largest export market for pork," Mr. Wyatt said.
Brazil’s exports to other countries have recorded only slight changes over the last 10 years, and entering new markets has proved somewhat difficult. Therefore, domestic demand will likely need to pick up, if exports do slow. The economy in Brazil is forecast to grow again, which is positive, but higher interest rates could make it harder to attract investment in the sector, and poultry is becoming more ingrained all the time.
Mr. Wyatt concludes that "with both supply and demand growth uncertain, it will be an interesting balancing act for the sector to perform."
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