Brazil Discovers Olive Oil

Tunisia's olive oil Olive oil consumption in Brazil has been growing continuously over the last three years  -  although it is still small when compared to other countries. Brazilians currently consume around 35,000 tons of olive oil. The figures available show that between 2006 and 2007 consumption of the product rose 45%.

Last year, Brazilian imports of the product totaled US$ 170 million. Of this total, 54% came from Portugal. And the forecast is for growth to continue as, this year, expansion of 20% is expected in comparison with 2007.

Two reasons are given for the market growth: the first is that Brazilians are seeking more and more sustainable products to consume. And it is known that olive oil helps prevent cardiovascular diseases as it reduces cholesterol levels.

The second, in the evaluation of the president of the Brazilian Association of Producers, Importers and Traders of Olive Oil (Oliva), Armando Reis Filho, is the price of olive oil:

"Different from soy and other kinds of oil, whose prices have risen due to global hikes, the tendency for consumers of olive oil has been the opposite. Product prices have either dropped or remained stable."

These factors could be good for Arab producers of olive oil, who could become alternative suppliers of the product to companies in the country, increasing their participation in the Brazilian market, which is currently minute.

Last year, for example, the Arabs exported around US$ 371,000 of this product to Brazil. According to exporters heard by Southern Frontier, the Arabs, in the medium term, could triple their sales of the product.

For this to take place, the recipe suggested by the Oliva president to the Brazilian market, is marketing campaigns organized by Brazilian importers and exporters of Arab products promoting the olive oil produced in that region of the world.

Few Brazilians know that Tunisia is the fourth main global exporter of Olive oil, losing only to Spain, Greece and Italy  -  and well ahead of Portugal, the traditional Brazilian supplier.

Exporters guarantee that in Brazil few people know that the Arab countries  -  mainly Tunisia, Syria, Morocco, Lebanon and Egypt  -  export large volumes of the product.

Recent figures show, for example, that together, the Arab countries that produce olive oil are the second main exporters of the product. Together, they sell to the global market around US$ 1.4 billion of the product each year.

After recalling that immigrants, when they arrive in a new country, bring and keep with them, transferring to their descendants the culture and gastronomy of their country of origin, the Oliva president concluded that:

"In the case of Arab immigrants, olive oil is a component of the staple diet. And the descendants keep this habit. Therefore, it is a great market niche that importers and producers of olive oil in the Arab countries may occupy in Brazil. And this niche, considering that the country has eight million people of Arab descent, and is an excellent vein," said Reis Filho, who bets on greater per capita consumption of the product in Brazil. Now this consumption is 15 grams per year. In countries like Spain, Italy and Greece, this consumption is between 10 and 20 kilograms.

Red Carpet

The Brazilian government made a point of offering a first-class welcome to the Jordanian Foreign Minister, Salaheddine Al-Bashir, in his visit to Brasí­lia. He had an audience with president Lula, a meeting with minister Celso Amorim and luncheon at the Itamaraty (Brazilian foreign office), which was described as warm-hearted by those in attendance.

The idea was to return the kindness of the Jordanian government. In February, Amorim went to the Arab country and was welcomed by king Abdullah II and the prime minister, Nader Dahabi, and was quite pleased with the way he was treated.

Lula told the Jordanian foreign minister that he intends to visit the Arab country, which may happen next year, after the visit of king Abdullah II to Brazil, scheduled for October.

Big Fair

Big Five, the most important fair for the Middle Eastern civil construction industry and the leading trade show for the sector in the Arabian Gulf is going to count, in this year's edition, on the participation of 36 Brazilian companies.

The pavilion will have 480 square meters (5167 sq feet), with 36 stands and a common area. The Brazilian participation is being coordinated by the Brazilian Export and Investment Promotion Agency (Apex), with support from the Arab Brazilian Chamber.

The Big Five takes place in Dubai, lasts from November 23 to 28 and should bring together approximately 2,000 companies from 67 countries. The fair has been important for Brazilian businessmen in the sector to expand their businesses in that region of the world. The fair, according to executives at Brazilian civil construction companies, has contributed to increase Brazilian exports in the sector to the 22 Arab countries.

Last year, foreign sales of construction material from Brazil to the Arab countries totaled nearly US$ 380 million, as against US$ 311.6 million in 2006, growth of 22%, according to data supplied by the Arab Brazilian Chamber of Commerce.

The Great Villain

The world food crisis cannot be ascribed to biofuels and increased demand alone. Speculative action by Hedge Funds (derivative funds) in basic commodities, such as oil and grain, answered to 40% of food price increases.

"Reckless speculation by these funds has been driving up costs, encouraging private companies to increase their prices, thereby accumulating skyrocketing profits," says professor Eugênio Stefanello, who specializes in Rural Economy.

To give an idea of the speculative power of these funds, Stefanello recalls that the volume of commodity securities traded at stock markets is 17 times larger than the physical volume of global production.

You may contact the author writing to joel.guimaraes@anba.com.br or joel@agenciameios.com.br.

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