October 26, 2006

Brazil's Sadia moving into local, global beef markets

Brazil's largest chicken company, Sadia SA, said this week that it will be increasing its participation in the local and international beef markets in the next fiscal quarters.

On Tuesday (Oct 24), the company's chairman, Walter Fontana Filho, said the company will be proposing to the company's Board of Director's a 750 million Brazilian reals (US$348 million) investment package for facilities in Mato Grosso state and in Kaliningrad, Russia.

Fontana Filho said the company was in the process of learning the beef market again after taking over a meat-packing facility the company had rented to Grupo Friboi, Latin America's largest beef exporter. The facility, located in Mato Grosso, processes roughly 1,000 bovines per day. The meat is shipped internationally.

Sadia's beef exports represented just 3 percent of the company's 3.5 billion reals revenue in the first half of 2006, a company spokesman said Wednesday.

Beef sales are growing. In the first half of 2006, Sadia sold 2,500 tonnes of fresh boneless beef to the local market and 7,200 tonnes to export markets. In the second quarter, Sadia sold 8,700 tonnes locally and 57,000 tonnes to export markets, a company spokesman said. Third quarter results are due out in two weeks.

Brazil is the world's leading beef exporter. Sadia is Brazil's largest chicken meat processor and one of the world's top meat exporters.