Difficult year ahead for Brazil’s animal protein sector

Experts from companies, research institutes and financial institutions talked about industry concerns in 2014 at Avesui in Florianopolis, Brazil. 
Short- to medium-term factors are expected to act as a drag on Brazil’s animal protein production but, longer term, there are important opportunities that must be capitalized upon. The opening of the 14^th edition of the Brazilian pig and poultry trade show Avesui, held in Florianopolis, Brazil, saw a discussion of the outlook for animal protein in the country, and offered a mixed picture.
Commenting on demand from the home market, Ariovaldi Zani, CEO of feed association Sindiracoes, said: “The year ahead will be difficult, as there will need to be adjustments. These adjustments are necessary but will result in less money for families to spend, and because of this the population will experience some difficulties.”
But economic conditions at home are not the only problems that the sector will have to confront. Other difficulties highlighted were growing competition for grain and oilseads from the bioethanol industry, and the need to explain to animal rights groups the importance of science in animal production. 
Pig, poultry exports
Looking internationally, delegates were reminded of the important opportunities offered for exporters by Colombia and Mexico, particularly the latter, given problems  it has experienced with its animal health controls.
China, however, was highlighted as being of particular importance for longer-term export opportunities.
By 2020, it has been calculated that some 400 million people will have migrated from China’s countryside to its cities. This number is twice the population of Brazil and almost four times that of Mexico.
Adolfo Fontes, analyst with Rabobank in Brazil, said: “This is a great opportunity for pig and poultry meat,” continuing that China’s younger generation tended to eat more chicken meat.
China will have a growing impact on the world’s supply and demand for food, as it must look outside its borders to feed its people. Within 10 years, it is estimated that 90 percent of China’s demand will be for processed products, and this is where exporting countries – such as Brazil – must make the most of opportunities.
The industry must work with government to facilitate trade in processed products, delegates were told, but at the same time achieve a balance between trade in processed products and commodities. Brazil is an exporter of both.