October 20, 2012
Brasil Foods to focus on its Sadia brand's international expansion
In order to help diversify global revenue and reduce exposure to volatile commodity prices, BRF Brasil Foods will focus on international expansion for its Sadia brand.
A further migration to processed foods will also reduce dependence on commodities, add value and reduce earnings volatility, Fabio Camparini, international marketing director, told the newswire in Sao Paulo.
The growth strategy signals a shift for Brasil Foods toward more processed products than ever before, a choice meant to help shield the company from commodity price fluctuations. Processed foods made up 22% of BRF's export portfolio in 2010, and have risen to 46% in 2012.
BRF will launch the Sadia brand in countries where it currently has no presence, and re-launch products in a Sadia portfolio where its poultry and processed foods are already being sold.
Between 2013 and 2014, Brasil Foods will debut the Sadia brand in various African and Middle Eastern countries, while plans for Asian markets like Singapore, China and Japan have no timeline set, as of yet. The company also sees expansion opportunities available in Latin America, following its acquisition of Argentine brands this year in an assets trade with Marfrig.
The company is considering both "organic and inorganic" growth, Camparini told Reuters, indicating that BRF hasn't ruled out further acquisitions or partnerships in strategic export markets.
The company announced earlier this year its purchase of a 49% stake in Federal Foods of Abu Dhabi, United Arab Emirates. It's a leader in food distribution for the Middle East, a region that accounted for 35.2% of BRF's export sales in second quarter of 2012. Brasil Foods is also building a processed foods plant in Abu Dhabi, expected to open in the first half of 2013.