For Brazil’s Beef Industry the Worst of Crisis Is Over

Brazilian beef Brazilian exports of raw beef are starting to show signs of recovery. Figures supplied by Brazilian Beef Industry and Exporters Association (Abiec) indicate that in June, the country exported 132,000 tons, a volume 9% higher than recorded in the same period of 2008.

Revenues from sales are also decreasing less than they did last year. In the first quarter the rate was 34%, in the first half it was 29%, and in June alone it was 14%.

Last month, foreign sales of raw beef contributed US$ 289 million to the Brazilian balance of trade, whereas the accumulated result in the first half of the year was US$ 1.36 billion. The executive director of Abiec, Otávio Cançado, said in a press release that the worst of the crisis is over, the supply of export credit is back to normal, and markets are heating up again.

"There was a worldwide retraction of economy, which impacted the performance of Brazilian beef exports. Brazil is the largest beef exporting country in the world, and is capable of retaining its leadership position: all that it takes is for the world economy to return to the level at which it was before September 2008," said Cançado.

The Abiec also informed that at the peak of the crisis, the dollar was equivalent to 2.50 Brazilian reais (US$ 1.27 at current exchange rates), and now it is worth 1.99 real (US$ 1.01), besides the fact that the average price of beef has decreased by approximately 14%.

Russia remains the leading buyer of Brazilian raw beef, having purchased 237,000 tons from January to June, generating revenues of US$ 410 million for the country. The city of Hong Kong, a special administrative region of China, ranks second, followed by Egypt and Algeria.

The Chilean market represents hope for increasing exports in the second half. An embargo was imposed on Brazilian beef in October 2005, and only in April this year certain Brazilian slaughterhouses were authorized to sell to the country again. The Abiec, however, believes that the volume of trade between the two countries is much lower now than it was before the embargo.

In order to try and accelerate the resumption of exports, representatives of the Abiec are going to promote, starting now, meetings in Santiago, the capital of Chile, with the participation of businessmen, secretaries of state, restaurant owners, food critics, and news reporters.

ABr

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