Foreign demand for beef drives Minerva’s results
Exports from the Brazilian food company’s domestic units accounted for 72% of gross revenue in Q2 2020. Asia’s share in total sales leaped from 25% to 50%, while the Middle East’s slid from 27% to 9%.
Isaura Daniel, Brazil-Arab News Agency (Brazil)
Translated by Gabriel Pomerancblum
São Paulo – Strong foreign demand for beef was one of the drivers of results for Brazil’s Minerva Foods, the biggest meat exporting company in South America during Q2 this year. Exports accounted for 72% of gross revenues in Q2, up 16% year-on-year, executives told investors during an online conference this Wednesday morning (29).
Asia drove a hike in sales. The continent was responsible for 50% of total export revenues from Minerva’s units in Brazil during the quarter, up from 25% in Q2 2019. Sales to all other parts of the world dropped, including to the Middle East, which went from a 27% share from April to June 2019 to 9% this year. Sales also slowed to the Americas, the European Union and Africa. Exports to the Commonwealth of Independent States (CIS) went up. The NAFTA countries went from zero in Q2 2019 to 1% in Q2 2020.
“The volume previously shipped to the region was primarily diverted to meet demand from Asia,” read a Minerva report, in reference to the Middle East’s diminishing imports of product from Minerva in Brazil. China is the leading importer in Asia, but demand is buoying elsewhere in the continent as well.
“Export results attest to growing demand for beef in Asia – mostly in China, but also in other markets, like Indonesia and Malaysia. This trend is expected to persist in the quarters ahead,” Minerva CEO Fernando Galletti de Queiroz said during the conference. Asia was also the premier destination for the company’s Athena Foods units in Uruguay, Paraguay, Argentina and Colombia, having taken in 42% of foreign sales, down one percentage point year-on-year. The Middle East’s share climbed from 5% to 7%.
According to Queiroz, the foreign sales outlook remains highly advantageous. He mentioned the African swine flu outbreak, which is affecting pork production China and paving the way for Brazilian beef. Other factors include a shift in consumer habits in Southeast Asia stemming from urbanization, rising income and a growing middle class; meat availability issues in Australia, which competes with Brazil; and the impact of the pandemic in United States output. “More recently, we have seen problems with buffalo meat exports from India, which have created opportunities in several markets across Asia and the Middle East,” he said.
According to Minerva’s CEO, the scenario reflects greater openness to product from South American countries...