No signs of a fall in output
Although it is important to always have an eye on the future as situations can change quickly, news coming out of Brazil at present is doing little to back up the concerns voiced recently by president Centre for the Brazilian Tanning Industry (CICB) Luiz Bittencourt over a slump in beef consumption and a fall in the availability of raw materials for the leather industry.
The country has already reported an 18% increase in beef exports this year and now Brazil’s third largest beef processor and exporter Minerva has posted a massive 25% increase in revenues up to September.
In the first nine months alone Minerva reported revenues of 1.13 billion reais ($629.3 million), up 25% from the 907 million reais ($505.1 million) reported in the same period in 2006, of which 831.7 million reais was generated through exports and 300.6 million reais came from the domestic market.
Contradicting Mr Bittencourt’s opinion, CEO of Minerva Fernando Galletti de Queiroz said that low beef production costs in Brazil combined with increased global demand were the main factors boosting the company’s growth. He said: "Brazil is one of the world's most competitive countries in beef, with a production cost of $1.50 per kilogramme. The production cost per kilogram in Uruguay is $1.70, in Australia $2.41, in Canada $2.85 and in the United States $3.14.”
He added that Brazilian beef remains competitive even in the face of an unfavourable currency exchange rate as a result of continued high demand.
