Marfrig records first profit since 2010, while BRF’s fate falls

For the first time since 2010, the world’s second largest meatpacker, Marfrig Global Foods SA, recorded a net profit in the final quarter of 2018, of R$2.2bn. The sale of US-based Keystone, a deal worth R$8bn, enabled the company to make a profit and made up for losses earlier in the year, leaving Marfrig with R$1.4bn in profits in 2018. The deal allowed Marfrig to cut its debt in half to R$2bn. Marfrig’s loss in 2017 stood at nearly R$485m.

With the sale of Keystone, a company specializing in the supply of chicken to McDonalds, Marfrig has concentrated its operations on beef. Marfrig acquired control of the US’s fourth-largest beef company in 2018, and according to Valor, the decision has proved to be a good move. DatamarNews reported Marfrig has recently received authorization to ship fresh beef to Japan from Uruguay, which National Beef Packing Company already does from the US. Marfrig believes they can leverage the knowledge and experience gained from the US subsidiary to cater to the Japanese market.

Meanwhile, Brazilian food processor BRF SA published wider than expected losses of R$2.125bn in the fourth quarter of last year. Troublesome embargoes, questionable food safety standards, and the country’s uncertain economy had the better of BRF. This was the company’s second consecutive quarterly loss.

The following DataLiner graph shows both the company’s TEU export trends for the last ten years:

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