BRF says that new Saudi rules on chicken shelf life could hurt sales

Saudi Arabia’s proposed reduction of the shelf life for chicken products could hurt Brazilian food company BRF SA’s business in the kingdom, according to Chief Executive Lorival Luz.
calendar icon 14 May 2021
clock icon 4 minute read

Reuters reports that the proposed restrictions, communicated by the Saudis to the World Trade Organization (WTO), would cut the shelf life of frozen chicken to three months from one year previously, potentially disrupting BRF's ability to serve that market, Luz said in a call to discuss the company's first-quarter results.

BRF, which is Brazil's largest chicken processor, operates via partnerships with local Saudi companies and also exports products to the kingdom from Brazil.

If implemented, a shorter shelf life for frozen chicken products would impose logistical challenges for both local suppliers and foreign exporters based in countries including France, Ukraine and Brazil.

"Jeddah, Saudi Arabia's main port, is some 1,000 kilometers away from the country's capital Riyadh," said Patricio Rohner, a BRF executive overseeing international markets. "Both local and foreign suppliers will have to adjust if this becomes the new standard."

In a statement to Reuters, Brazilian meat lobby ABPA said the proposed reduction of chickens' shelf-life in Saudi Arabia is a decision of "a potential protectionist nature".

The proposed rule change comes less than a week after Saudi Arabia banned imports from 11 Brazilian poultry plants without warning or explanation, a move that affected mainly JBS SA in Brazil.

On 11 May, BRF said Saudi authorities had notified the WTO of the proposed change regarding product shelf life, which is not yet in effect. BRF said it would consult with authorities on what measures could be taken in line with WTO rules following the Saudi move.

The trade body's members affected by the measure have 60 days to comment, BRF said.

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