JBS assina novo acordo de até R$3 bi envolvendo exportações para China

JBS has signed a memorandum of understanding with the WH Group, a Chinese meat and food processing company, to supply fresh beef, poultry and pork to the Chinese market.

In a statement, JBS said that under the agreement the supply products would be supplied using the Friboi and Seara brands. The agreement is worth up to R$3 billion reais per year. The first shipments resulting from the partnership will take place in the first quarter.

According to JBS, in addition to expanding its market share in China, especially beef, the partnership aims to provide the consumer with direct access via more than 60,000 exclusive WH Group points of sale in the country.

Beef price falls

A recent survey done by the Ministry of Agriculture, Livestock and Supply (Mapa) found a drop in the price of beef since the beginning of the year, motivated by a reduction in consumer demand and in the volume of beef exports to China.

The following graph uses DataLiner data to show Brazilian meat exports from January 2015 to November 2019:

Chart source: DataLiner / Datamar

The prices of live cattle last Friday (24) was quoted at between R$170 and R$180. In Mato Grosso do Sul for example, this represents a 10.5% drop between December 30, 2019 when it was quoted at R$190, and last week’s quote of R$170.

Sources: Reuters and MAPA

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