Pork exports - a bet for 2020
With an annual average of 15.5 kilos consumed per person, according to Portal Sebrae, pork is the most consumed in the world. In addition to international projection, this type of meat is also well accepted in Brazil, as domestic production grew by 134.7% between 1995 and 2012, according to the Portal Sebrae, and it is expected that by the end of 2019 it will grow 4.9% - which will keep Brazil in the position of fourth largest producer and exporter of the product. These indices are encouraging for those who want to invest in pig farming, a good bet for the year 2020.
Economic Projections for 2020
José Zeferino Pedrozo, President of the Federation of Agriculture and Livestock of the State of SC (Faesc) and of the National Service for Rural Learning (Senar/SC), pointed out in a comment to the Industrial Swine website that there are positive macroeconomic indicators, such as inflation under control, low interest rates, falling Brazil risk, which corroborate a general sentiment in the market and society according to which 2020 will represent a long period of economic growth in general. Pedrozo points out that agribusiness exports will remain high, especially in the meat and grain segments, and in the foreign market there is a great outlet for Brazilian international projection.
PSA and China's role in Brazilian exports
Over 2019, from January to November, pork exports generated US$1.4 billion to Brazil, according to the Brazilian Association of Animal Protein (ABPA), an amount that represents 27.9% more than compared to the corresponding period in 2018. China absorbed 32.7% of this total.
Since the African Swine Fever (PSA) crisis in China, in the second half of 2018, the country, responsible for almost half of the world's pork production, has invested heavily in importing this product to meet the demands of the domestic market, having increased from 1.56 million tons imported in 2018 to 2.6 million in 2019, points out the 2020 Yearbook of Industrial Swine. The projection for 2020 is that this number will only increase - according to the United States Department of Agriculture (USDA), Chinese imports should grow by 35%. This scenario is very favorable for Brazil, as China is the largest importer of Brazilian pork, accounting for practically 33% of exports in 2019, as mentioned above.
Opportunities in South America and worldwide
Likewise, exports to the main markets in South America are also showing growth. There was a 38.4% increase in Brazilian pork exports to Chile - the third largest destination for this type of product, according to the 2020 Yearbook of Industrial Swine. In all, South American countries should absorb 16% of Brazilian pork exports in 2019, proving to be an interesting market for investments in the next year. Both data were pointed out in the 2020 Yearbook of Industrial Pig Farming.
In general, there is a promising scenario for the pork industry in Brazil, especially when it comes to exports. In addition to the Chinese market, which is a strong consumer of this protein, there are focuses to be explored in South America, given the very strong growth observed in Brazilian imports into Chile.
In addition, the European Union's restriction on the import of Brazilian beef may open space for the export of swine, as long as they meet the requirements of the buyer countries - mainly regarding quality control, points out the Portal Sebrae. Thus, it is possible to infer that the swine market is promising for the year 2020.
The importance of assistance from an international consultancy
For the entrepreneur interested in exploring this niche, however, some steps are needed that can be remedied through an international consultancy. For example, in the aforementioned case of the European Union, a Market Identification survey would be necessary to find out if there is, in fact, this new space for swine. Even consolidated markets as importers, such as China and Chile, require research on the Regulations and Tariffs required to carry out the export.
By Isabella Reis on 12/20/2019