Saudi Arabia trims list of authorised Brazil chicken exporters

23 January 2019, at 12:00am

BRAZIL (Reuters) - Saudi Arabia has barred five Brazilian chicken processing plants from exporting to the Middle Eastern country, leaving 25 with valid export permits, Brazil's meat trade association ABPA said on Tuesday, citing "technical" reasons

Words Ana Mano

The Saudi move threw up a fresh hurdle for top exporter BRF SA and its rivals just a day after an anti-dumping dispute with China was resolved.

BRF shares were down 3.8 percent in late afternoon trading, while rival meat processor JBS SA was down 0.6 percent after earlier falling as much as 2.4 percent.

Some 58 Brazilian plants are currently authorised to export to Saudi Arabia, ABPA said. In a revised follow-up statement, the trade groups said only 30 of those are effectively shipping products to the kingdom.

According to Brazil's Ministry of Agriculture, the 25 plants that remain authorized to export to Saudi Arabia accounted for 63 percent of Brazil's chicken exports to that country last year.

The list of authorised exporters, which was revised after a Saudi trade mission in Brazil last October, includes units operated by listed food processors JBS SA and BRF SA, the ministry said.

ABPA did not discuss the plants missing from the downsized list, blaming "technical" reasons for the Saudi move to reduce the number of export permits.

"Corrective action is being taken to restore the authorisations," ABPA said in its initial statement, without elaborating.

Folha de S. Paulo earlier reported the Saudi move could be linked to the Brazilian government's intention to move its embassy in Israel from Tel Aviv to Jerusalem.

But in an emailed message to Reuters, ABPA said that Saudi Arabia's decision was "not related to any diplomatic matters."

BRF declined immediate comment. JBS referred comments to the trade association.

Saudi Arabia in 2018 was Brazil's top buyer of fresh and processed chicken products, an ABPA spokesman said.

ABPA data shows the Saudis imported 433,500 tonnes of chicken products from Brazil, or about 11.8 percent of all such sales from Brazilian purveyors.

China was a close second, importing around 400,900 tonnes of fresh chicken and byproducts, corresponding to 10.9 percent of total sales, according to the trade group's data.

China's Ministry of Commerce on Monday accepted an offer made by Brazilian chicken exporters to end a dumping investigation.

Reporting by Ana Mano; editing by Bernadette Baum, Marguerita Choy and G Crosse