BRF’s Innovative Grain Purchasing Approach

Discover BRF’s sustainable transformation in this insightful article. Learn how the Brazilian food giant plans to increase direct grain purchases to 40%, enhance supply chain control, and achieve 100% traceability with suppliers by 2025. Explore their commitment to environmental responsibility, including ceasing purchases from deforested areas, setting a new standard in the industry.

BRF, Leading Brazilian Food Processor, to Enhance Grain Purchase Strategy for Improved Traceability

In a significant move towards sustainable sourcing, BRF BRFS3.SA, a top-tier food processor in Brazil, has announced its ambitious plan to intensify direct grain purchases from local farmers. This strategic shift aims to elevate the company’s traceability standards, a vital step in ensuring a sustainable and transparent supply chain.

BRF Targets 40% Direct Grain Purchases in Sustainability Push

The company, renowned as one of Brazil’s largest purchasers of corn and soybeans, has set a target to procure 40% of its grain directly from farmers by the upcoming year. This initiative marks a considerable increase from the 17% direct purchases recorded last year and 32% in 2023. Such an expansion in direct procurement underscores BRF’s commitment to enhancing control over its production chain and achieving its traceability objectives.

In an effort to facilitate this transition, BRF has undertaken significant organizational changes. These include redeploying staff from corporate sectors to rural units and bolstering grain purchasing teams in key agricultural states like Mato Grosso and Minas Gerais. These moves demonstrate the company’s dedication to strengthening relationships with local farming communities and enhancing the efficiency of its supply chain.

BRF Sets Ambitious Goal for 100% Supplier Traceability by 2025

Further amplifying its commitment to sustainability, BRF has updated its goal to achieve 100% traceability from both direct and indirect suppliers by 2025, as articulated by Raquel Ogando, the company’s Director of Reputation and Sustainability. Currently, BRF boasts complete traceability of direct grain suppliers in critical biomes such as the Amazon and Cerrado. Additionally, the company is on track to increase traceability from its indirect suppliers to 75% this year, a notable rise from the previous 45%.

In a bold stance towards environmental conservation, BRF has also declared its intention to discontinue grain purchases from legally deforested areas in the Brazilian Cerrado biome by the end of 2025. This decision aligns with the company’s long-standing policy of not sourcing grains from deforested areas in the Amazon since 2008. Ogando highlighted that from 2026, BRF will completely cease working with grains from any legally deforested areas, aligning with the science-based targets initiative (SBTi) principles.

BRF to Halt Grain Purchases from Legally Deforested Areas in Cerrado by 2025

This series of strategic decisions by BRF not only fortifies its position as a leader in sustainable food processing but also sets a benchmark in the industry for responsible and environmentally conscious business practices. The company’s efforts reflect a growing trend among global corporations to prioritize sustainability and traceability in their supply chains, ensuring a better future for the planet and its inhabitants.

South America Set to Lead 50% of World Beef Exports

Discover how South America, led by Minerva Foods, is poised to dominate 50% of global beef exports in the next five years.

South America Eyes Half of Global Beef Exports by 2028, Says Minerva CEO

In a bold forecast that highlights the shifting dynamics of the global beef industry, Minerva Foods’ CEO Fernando Queiroz has announced that South America is set to account for a staggering 50% of the world’s beef exports within the next five years. This marks a significant rise from the current 40%, signaling a potential reshaping of global beef trade patterns.

The CEO’s remarks came during a recent event hosted by Minerva, a major player in the beef processing sector. This prediction is underpinned by a series of strategic expansions and acquisitions by Minerva, notably the purchase of facilities from their competitor Marfrig. This move not only strengthens Minerva’s presence in South American markets but also reflects the region’s growing influence in the beef industry.

South America’s ascendancy in the global beef market is not just a matter of increased capacity. The region’s predominance in grass-fed cattle farming, seen as a key competitive advantage, and its comparatively lower labor costs, especially against the backdrop of the U.S., the current world leader in beef production, play crucial roles. These factors contribute to a more cost-effective and potentially more sustainable beef production model.

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Strategic Acquisitions Propel South America to Beef Export Dominance

Over the past 15 years, Minerva has been on a significant acquisition spree, with 20 takeovers aimed at cementing its position in top beef-exporting nations like Brazil, Argentina, Uruguay, and Paraguay. This aggressive expansion strategy reflects the company’s ambition to become a central figure in the global beef market.

A recent landmark deal in August further underscores this ambition. Minerva announced an agreement to acquire cattle and sheep slaughtering units from Marfrig for R$ 7.5 billion real ($1.54 billion). This acquisition is expected to boost Minerva’s slaughtering capacity by about 44%, allowing it to process over 42,000 heads per day across its units in Brazil, Uruguay, Argentina, and Chile.

Backing this expansion is a robust financial commitment from JP Morgan Bank, ensuring that Minerva has the necessary resources to complete these ambitious plans.

The Future of Beef: South America’s Growing Global Influence

As the global beef market continues to evolve, South America’s emerging dominance, led by companies like Minerva, is a development that industry watchers and stakeholders around the world will be keenly observing. This shift could herald a new era in beef production and trade, with far-reaching implications for producers, consumers, and the global economy.

Read: Top 10 Argentina beef producers

Brazil’s Top 10 Largest Meat Supplier Powerhouses

Brazil’s Meat Industry Powerhouses: A Look at the Top 10 Suppliers

São Paulo, Brazil – Brazil’s meat industry is a global powerhouse, boasting a roster of top suppliers that drive not just the national economy but also play a crucial role in the world’s food supply chain. This report delves into the top 10 meat suppliers in Brazil, highlighting their financial muscle and market presence.

JBS S/A Leads the Pack

Topping the list is JBS S/A, headquartered in Osasco. With a staggering revenue of $18.7 billion in the third quarter of 2023, JBS S/A isn’t just a national leader; it’s a global titan in the meat industry. Its extensive operations and market reach set the benchmark in the sector.

Marfrig: A Strong Contender

Close on the heels of JBS is Marfrig, based in Barretos. Though the data from the first quarter of 2022 places its revenue at 22.3 billion reais, this figure underlines the company’s significant position in the market. Marfrig’s financial results reflect its robust presence both in Brazil and internationally.

Minerva S/A: Robust and Growing

Minerva S/A, another Barretos-based giant, reported a commendable 7.56 billion reais in revenue in the third quarter of 2023. This performance cements Minerva’s status as a key competitor and a robust player in the meat supply landscape.

MAIS FRANGO MIRAGUAI: Small but Mighty

Showing that size isn’t everything, MAIS FRANGO MIRAGUAI from Miraguaí makes its mark with a revenue of $122.26 million. This figure is a testament to the company’s significant contribution to Brazil’s meat industry, despite its smaller scale compared to industry leaders.

Brazil’s Top 10 Largest Meat Supplier Powerhouses

The Unsung Heroes

Rounding out the top 10 are Frigorifico Better Beef (São Paulo), Frigorifico Silva Industria e Comercio (Santa Maria), Vale Grande Industria e Comercio de Alimentos (Sinop), PLUSVAL AGROAVICOLA (Umuarama), Frigorífico Redentor S/A (Guarantã do Norte), and Notaro Alimentos (Belo Jardim). While specific revenue data for these companies are not available, their inclusion in this list underscores their importance in Brazil’s meat supply chain.

The Brazilian Meat Industry: A Global Force

This report not only highlights the financial prowess of these companies but also underscores Brazil’s significant role as a leading meat exporter and producer on the global stage. The industry’s dynamic nature, marked by these top players, reflects Brazil’s evolving and influential position in the global meat market.

Author: Essa Eshat

Relevant organisations: ABIEC

JBS explores Saudi investments

Explore the latest strategic business expansion of JBS SA’s parent company J&F into Saudi Arabia, highlighting significant investment plans, the impact on global meat industry, and strengthening Brazil-Saudi economic relations. Stay informed about this pivotal development in international trade.

JBS SA’s Parent Company J&F Explores Significant Investment Opportunities in Saudi Arabia

Introduction

In a recent development that underscores the growing business ties between Brazil and Saudi Arabia, J&F, the parent company of JBS SA (JBSS3.SA), has expressed its intention to expand its investments in Saudi Arabia. This move aligns with the ongoing efforts of the Brazilian government, led by President Luiz Inacio Lula da Silva, to strengthen international business relations.

Growing Interest in Investments

During a high-profile meeting involving President Luiz Inacio Lula da Silva in Riyadh, Wesley Batista, a prominent figure from JBS’ founding family, announced the company’s increased interest in making substantial investments in Saudi Arabia. This statement marks a significant shift in JBS’ investment strategy, indicating a deeper commitment to expanding its global presence, particularly in the Middle East.

JBS’ Expanding Operations in Saudi Arabia

J&F, a conglomerate with diverse interests in food, mining, pulp, paper, and energy sectors, currently operates a plant in Damman and is in the process of constructing another in Jeddah. The completion of the Jeddah facility is set to quadruple JBS’ capacity in Saudi Arabia, allowing the company to produce 40,000 metric tons of processed chicken products annually.

Strategic Economic Relations

Saudi Arabia, noted as the Middle East’s largest economy, is a key trading partner for Brazil, with bilateral trade exceeding $8 billion in 2022. Brazil’s prominence as the world’s top exporter of halal meats aligns well with the demands of the Middle Eastern market. However, JBS faces intense competition from other Brazilian giants such as BRF, Minerva, and Marfrig, who are also active in the Gulf region.

Related: JBS NY Listing Struggle

Saudi Arabia’s Vision for the Food Sector

Khalid Al-Falih, Saudi Arabia’s Minister of Investment, highlighted the food sector as a primary area of cooperation between Brazil and Saudi Arabia. He articulated Saudi Arabia’s ambitions to achieve food security and become a global hub in the meat sector, signaling potential for increased collaboration and investment in the future.

Conclusion

The announcement by J&F about considering further investments in Saudi Arabia is a significant development in the global meat industry. It not only reinforces the strategic economic ties between Brazil and Saudi Arabia but also highlights the evolving landscape of international trade and investment. As JBS SA expands its operations, it contributes to a broader narrative of global business growth and intercontinental partnerships.