December 5, 2008

China has reopened its market to Brazilian chicken after the two countries reached an agreement on poultry sales.

China will import chickens from 24 slaughterhouses in eight Brazilian states which are Rio Grande do Sul, Santa Catarina, Parana, Sao Paulo, Mato Grosso do Sul, Mato Grosso, Goias and Minas Gerais.

Figures on China's buying potential were yet to be revealed, but indirect poultry sales to China were about 350,000 tonnes per year, according to the Brazilian Poultry Exporters Association (ABEF).

Hong Kong imports Brazilian chicken, processes it and sells it to China.

Brazil's poultry companies may be the biggest beneficiaries of the reopened market in China, said Santander analyst Alexander Robarts.

Sadia, one of Brazil's leading chicken exporters, is optimistic about the deal with China.

"We've won the passport to the world's largest population market," said José Augusto Lima de Sá, Sadia's International Relations Director.

China is a key market for Brazil's farm products. In the first 10 months of 2008, China accounted for 12 percent of the US$61.9 billion revenue that Brazil received from exports of agricultural products.

China suspended imports of Brazilian poultry in mid-2007 due to sanitation issues. China has also recently signed a sanitation protocol with Brazil for the pork trade.