Brazilian agribusiness reroutes exports through the Red Sea after Hormuz closure

Brazil’s agribusiness sector has begun rerouting a large share of its food exports through the Red Sea, an alternative route that has taken on greater importance since the closure of the Strait of Hormuz in the war between Iran and the United States at the end of February.

The shift in logistics for exports to the Middle East, a major buyer of Brazilian chicken, sugar and grains, is part of a broader mobilization involving not only Brazilian exporters but also countries in the region, whose purchases fell quickly because of the war and the resulting logistics disruption.

In March, Brazilian beef exports to Middle Eastern countries near the conflict totaled 18,000 tonnes, down from 22,000 tonnes in February, a drop of more than 20%. The impact was similar for chicken exports, which fell 18.5% between the two months.

For beef, the affected markets are the United Arab Emirates, Jordan, Qatar, Iraq, Turkey, Saudi Arabia and Lebanon. For chicken, the list includes 13 countries: Saudi Arabia, the United Arab Emirates, Qatar, Oman, Kuwait, Iraq, Jordan, Yemen, Turkey, Palestine, Bahrain, Lebanon and Iran.

This is not a demand problem, said Ricardo Santin, president of the Brazilian Animal Protein Association (ABPA). “It is not a drop caused by lack of orders or market closures. It is only a logistics difficulty. In fact, demand is stronger because countries are seeking food security and stockpiling,” he said.

“What is important to note is that, even with the conflicts and closures, we have managed to maintain the flow of 80% of the volume through alternative routes such as the Red Sea.”

Most cargoes bound for Gulf countries normally travel on maritime routes that pass through the Strait of Hormuz, one of the world’s main trade corridors. The Red Sea has always been used, but as a secondary route. At the moment, however, it has taken on a central role in cargo redistribution.

Instead of heading directly to Gulf ports, ships have begun calling at ports on Saudi Arabia’s western coast, on the Red Sea, such as Jeddah, Yanbu, King Abdullah, Jazan and Neom. From those points, goods are moved overland to their final destinations. In many cases, smaller vessels are also being used for regional transport.

In recent weeks, major global shipping lines have reached an understanding with Saudi Arabia to enter the region through the Red Sea. In March, five new services operated by companies such as Maersk, MSC, CMA CGM and Hapag-Lloyd began including calls at ports along that corridor, adding about 64,000 tonnes of logistics capacity to the region.

Brazil’s Agriculture Ministry, informed by Brazilian diplomats in Riyadh, said last week that Saudi authorities had relaxed rules for the entry of products through the Red Sea. The ministry does not define which destination an exporter should choose, but it provides guidance on the matter. Last week, local ministry representatives across Brazil were instructed to share information on the alternative route with companies.

“The ports on the western coast, via the Red Sea, are operating with significant spare capacity and have been adopting measures to improve efficiency, including infrastructure expansion and better vessel scheduling,” the ministry said, adding that it had not, so far, identified difficulties reported by Brazilian exporters in redirecting cargo through Saudi Arabia.

“Cargoes originally bound for Persian Gulf ports can be redirected to ports on Saudi Arabia’s western coast without operational losses. The rerouting of cargo does not require changes to the import license or the International Sanitary Certificate, provided the local importer informs the Saudi authorities of the reason for the route change,” the ministry said in guidance sent to its regional offices.

Asked about the matter, the ministry did not respond before publication of the original report.

The route changes have pushed up transport costs. Roberto Perosa, president of the Brazilian Beef Exporters Association, or Abiec, said the Middle East conflict, a destination for 15% of Brazil’s meat exports, drove the cost of shipping a refrigerated container from about $3,000 to more than $7,000, meaning freight rates more than doubled.

“In addition, with route changes and diversions to avoid conflict areas, transport time and costs have increased. We are therefore negotiating with shipowners, although it is a difficult process, in an effort to mitigate part of these impacts,” he said.

Santin of ABPA said that, so far, most importers have been absorbing the exceptional costs because they need the product and do not want Brazilian industry to halt shipments. “Of the roughly 130,000 tonnes that were going to these countries every month, about 40% were already going to Red Sea ports before the conflicts. We still cannot say exactly how much that share has increased, but there has certainly been a significant rise on this route,” he said.

In 2025, Brazil exported $21.34 billion to Arab countries, down 9.81% from 2024, when performance had hit a record. According to data from Brazil’s Ministry of Development, Industry, Trade and Services, compiled by the market intelligence arm of the Arab-Brazilian Chamber of Commerce, sales of the main products exported to Arab markets, such as iron ore and chicken meat, declined. In the final quarter of the year, however, exports rose 8.2% from the same period in 2024.

Exports remained concentrated in agribusiness products. Of the $21.34 billion that Brazil exported to Arab countries last year, $15.91 billion came from agriculture and livestock, equivalent to 72% of the total.

Source: Folha de S. Paulo

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