December 14, 2004



Brazil to Become No. 1 Chicken Exporter in the World


Brazil's poultry farmers, sustained by fresh opportunities in the Middle East and Asia, have sharply increased production and are expected to overtake the United States to end the year as the world's No. 1 chicken exporter.


Brazil's emergence as a poultry powerhouse is a sign of the country's growing importance in the world of agriculture. The country is already the world's largest exporter of beef and soy beans. Its modern and economical production process, coupled with savvy trade deals with other developing nations, is likely to have Brazil's competitors complaining for years to come.


In 1997, Brazil's chicken exports were less than a third those of the US. But production has taken off since 2000. Growth averaged 20 percent in the past 2 years, and Brazil presently exports to 127 different countries and controls 36 percent of the world share, according to Claudio Martinez, executive director of the Brazilian Association of Chicken Exporters.


The main markets are in the Middle East and Asia, particularly China. With talks of the proposed Free Trade Area of the Americas and a deal with the European Union breaking down, Brazil has forged closer trade ties with behemoths in the developing world. President Lu¨ªz Inacio Lula da Silva has aggressively pursued better relations with countries like China, Russia, and India.


In particular, the Chinese are keen to strengthen trade relations with Latin America. Chinese Premier Hu Jintao last month promised to invest more than $100 billion in the region over the next 10 years. Brazilian chicken exporters would benefit through a deal reportedly worth $200 million a year by 2005. The agreement will help boost Brazilian exports to a region already feasting on Brazilian drumsticks. When Asian producers were laid low by avian influenza earlier this year, their Brazilians competitors moved in, and exports to Asia went up 84 percent between January and October.


There are other, more established reasons for the rise, Mr. Martinez adds. Brazil's industry is relatively new and therefore modern. Production costs are up to 25 percent lower than in the US. And sanitary controls have helped keep the country's birds free of pests.


American officials say Brazil cannot guarantee their birds are disease free and are therefore banned from the US. Brazil persistently rejects that claim and banned US imports in retaliation. Brazilian officials say they hope that, as the two biggest exporters, they can set an example and overcome the stalemate. The planned creation of a world poultry exporters organization would help producers resolve conflicts, Martinez says.

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