August 12, 2009

Brazilian pork exports suffered in July because of unfavourable forex conditions, an official with Brazil's Pork Industry Association, or Abipecs, said Tuesday (August 11).

 

"July was a terrible month for pork exports, due to the exchange rate," Abipecs President Pedro de Camargo Neto told Dow Jones Newswires.

 

Brazil exported 48,100 tonnes of pork in July compared to 56,110 tonnes a year ago, according to Abipecs.

 

Revenue dipped to US$100.5 million in July versus US$168.8 million in the same month a year ago, the association said.

 

"With the exchange rate at around BRL1.80, exporters can't survive," he said. The Brazilian real has strengthened over 25 percent since mid-March against the dollar. On Tuesday, US$1 equalled BRL1.84.

 

Abipecs expected around 600,000 tonnes of pork exports this year compared to 530,000 tonnes in 2008, which saw a sharp decline in November and December due to the economic crisis.

 

But Camargo warned that July's lower-than-expected exports may lead to a revision of the full-year target. He didn't give a new target.

 

Camargo said that swine flu, however, had a minor impact in the sales of raw pork meat in the domestic market. Most of the sales of pork related to ham or sausages that weren't impacted at home or for exports, he said.

 

Abipecs said that Russia continues to be Brazil's No. 1 destination with 19,900 tonnes of pork shipped in July. This was down 24 percent from a year ago. The Russian market continues to be tough, with reduced quotas and prices being squeezed, he said.

 

New markets have been slow to open. Exports to South Africa and the Philippines still remain shut, he said.

 

It is also unclear when pork exports to China will begin, Camargo said.

 

Brazil exported 342,580 tonnes between January and July, up 4.8 percent from the same period in 2008, according to Abipecs.