Brazil

Brazil is one of the top poultry producers in the world, ranking third for chicken meat and turkey meat production. In 2008 Brazil’s broiler production is estimated at 10,895 thousand metric tons and for 2009 production is projected to reach 11,417 thousand MT. Turkey meat production estimates total 510 thousand MT for 2008 and projections for 2009 are 550 thousand MT.

For 2008, Brazil is expected to be the world’s top chicken exporter, and have the second largest share of the turkey export market.

For the first seven months of 2008 (January – July), Brazil’s broiler exports rose over 13% compared to the same period in 2007. Increased demand from Venezuela (up 109%), Hong Kong (up 19%), Japan (up 30%), Kuwait (up 26%), and the United Arab Emirates (up 18%) more than made up for a 35% drop in exports to the EU and a 13% fall in exports to South Africa. China, while not a major market, fell 94%. The Middle East is an important export region and Brazilian companies are able to provide Halal for that market. Turkey exports increased almost 25% during this period. The EU is Brazil’s major export market for turkey.

In 2005, Brazil and Thailand won a World Trade Organization case against the EU’s tariff reclassification of salted chicken meat. In July 2007, the EU created a new regime for imports of salted poultry meat, preparations of turkey meat and cooked chicken meat into the EU, primarily from Brazil and Thailand. The EU administers the quotas and issues the certificates of origin necessary to import these items. Strong demand for these certificates/licenses has led to license trading between companies. European importers who purchase a license to import Brazilian poultry within the quota want to charge Brazilian exporters a discount equivalent to the fee paid for the licenses.

At the request of Brazilian exporters, Brazil’s Board of Foreign Trade (Camex) created a new model where Brazil manages the distribution of certificates of origin to export salted chicken within the quota to the EU. The Brazilian government will distribute the certificates to companies based on the past performance of the exporters (for items covered by the quotas). The new system went into effect on October 1, 2008.

In response, the European Union suspended the licensing of imports of salted chicken for one month, starting in October 2008. The EU complained the change was made without a bilateral consultation, as required by the WTO agreement. The two countries will discuss the issue in the coming weeks.

Further Reading

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