September 20, 2004



Brazil's Sadia To Expand Plant As Chicken Exports Boom


Brazilian poultry and pork firm Sadia SA (SDA) announced plans Friday to double the size of one of its plants as chicken exports from this South American country soar to new highs.


Brazil, the world's second biggest chicken exporter after the U.S., shipped 2.5 million tons of chicken abroad over the 12 months ended Aug. 31, bringing in a record-breaking $2.3 billion compared with $1.8 billion over the whole of last year. The local industry has been helped by outbreaks of Avian flu, which have closed markets to Asian poultry over the past year and pushed up global prices for chicken.


Sadia said Friday it plans to invest 185 million reals ($1=BRL2.88) between now and 2007 to double the chicken, turkey and pork it produces at its Uberlandia plant in the Southeastern Brazil state of Minas Gerais.


Once the expansion is complete, the Uberlandia plant will be Sadia's biggest, bringing in sales of about BRL1.55 billion per year. Sadia, which had consolidated net revenue of BRL3 billion between January and June and BRL5.3 billion in 2003, said about half the new capacity will be exported and half sold at home.


The competition in Brazil's poultry sector got hotter this month, when U.S.-based Cargill Inc. (CRG.XX) paid about $130 million for a controlling stake in one of Sadia's two big competitors, poultry and pork firm Seara Alimentos (SALM4.BR). Perdigao SA (PDA), which trades shares in both Brazil and New York, is the third of Brazil's big poultry producers.

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