August 3, 2012

Brazil's pork export reaches 225,000 tonnes in the first five months of 2012, representing a 5% on-year rise.

Record numbers since 2009 were made in May 2012, when 54,300 tonnes were exported. Main importers of Brazilian pork were Ukraine and Hong Kong.

Nevertheless, the Brazilian pork industry is suffering from current developments in the feed market. Between March and June 2012, soy prices grew by 32%. In the same timeframe, however, pig prices came down by 4%.

Current prices for pigs are about 30% lower than in the beginning of April. Gross margins in pork production therefore have dropped below zero. Rabobank states that pig prices have come down as a consequence of a dropping domestic demand as the economic situation is considered weak.

In addition, the beef industry is going through better times after four years of struggles, resulting in beef having become the main meat type in Brazil. For smaller and larger independent pig companies, it is more difficult to stay profitable.

The bank expects that the Brazilian pig prices will slowly increase again in the upcoming months.