Brazilian pig meat exports pick up pace

After stumbling in January, Brazil’s exports of pig meat have recovered strongly in 2021. In the year to the end of April, pig meat exports (including offal) from Brazil increased by 27% to 390,000 tonnes. This follows a 5% drop during January, when shipments to Hong Kong halved.

Trade with China dominated the rise in volumes in the first four months overall, increasing by 40% and accounting for nearly a half of Brazil’s pig meat exports. Other increases in trade came from Brazil’s closest South American neighbours, and volumes to Angola also rose.

Continued weakness in Brazil’s currency, the real, will have two effects: further improving the competitiveness of Brazilian product on world markets, and increasing domestic prices, eroding demand at home. Although rising in volume by 27% in the first four months of 2021, price rises meant the total value of exports rose by 52%. As Brazil’s export demand represents only about 30% of its production, volumes available to ship are particularly sensitive to domestic demand.

The incentive to export will be strong, a trend we have already seen in 2020. The most important customer will doubtless continue to be China, especially as ASF related problems are hampering its pig herd rebuild in the short term.

We await Q1 production data to see how the industry has been coping with Brazil’s significant ongoing challenges with COVID-19.

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