November 13, 2019
BRF considers poultry acquisitions in Turkey to expand production
The world's largest poultry exporter wants to grow its current 12% production in Turkey to 20% to affirm its position as leading global halal food supplier, reported Reuters.
The expansion plans were announced by Patricio Rohner, vice president of international operations BRF, but did not offer a specific timeline.
BRF also confirmed its US$120 million investment commitment to construct a Saudi Arabia poultry plant. However, studies are still being conducted by management for that plan.
Rohner said the company would sell its Malaysia poultry plant, which it deemed small and not aligned with the company's long-term plans. He added that potential bidders have offered to purchase the Malaysia plant.
With regard to acquisitions or the greenfield expansion, Lorival Luz, chief executive of BRF said this would be done respecting a strict financial discipline as BRF remains steadfast in finalising its organisational reshuffle.
In 2017, BRF was a part of a food security probe where health officials colluded with Brazil meat packers to avoid quality checks. The company is cooperating with investigations and is currently undergoing a management reshuffle after the scandal came to light. Conversely, because of this case it lost its approval to export to the European Union (EU).
20 Brazil meat facilities (mostly poultry) were banned by the EU in the aftermath of the food security probe. BRF operates 12 of these facilities.
However, the spread of African swine fever in China has proven to be a boon for BRF and Brazil's meat industry as a whole. BRF reported a second consecutive quarterly profit in the third quarter.
Carlos Moura, the newly appointed chief financial officer of BRF, said 1.5 billion BRL (~US$360 million; 1 BRL = US$0.24) of bank debt will be paid in the fourth quarter. An additional 600 million BRL (~US$144 million) will be paid in between October to December 2019.
He added that these are part of the company's plans to lower the cost of loans and extend debt maturities.