Jun 09, 2014

Russia Turns to Brazil for Needed Pork Imports

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Russia has recently opened the door for more pork imports from Brazil because of political problems with Ukraine and diseases in the hog herds of the U.S., Canada and Mexico. After the Brazilian Minister of Agriculture met with Russian officials in Paris last week, Russia has quickly reauthorized to importation of pork from eight Brazilian processing facilities and going forward, Russia will give special consideration to Brazilian pork in light of their urgent need for additional pork imports.

According to the Brazilian Animal Protein Association (Abpa), Russia only produces 60% of the pork consumed in the country and they are also dependent on beef and poultry imports as well. Russia has not yet achieved self-sufficiency in protein production and it must import meats from Europe, the United States, Canada, Brazil, and other countries.

In the past, Ukraine has acted as en entry point for some of the importing pork into Russia similar to the role played by Hong Kong as an entry point into China. Recent social unrest in Ukraine has essentially closed off that entry path forcing Russia to turn to Brazil for additional imports. Ironically, it was Russia that placed barriers to Brazilian pork in recent years siting sanitary concerns in Brazil's pork processing facilities at a time when some of these same facilities were cleared to import pork into the U.S.

The vast majority of Brazilian hog production is concentrated in southern Brazil in the states of Santa Catarina, Parana, and Rio Grande do Sul. In recent years hog producers in southern Brazil suffered from high corn prices due to the lack of corn production in the region and the high cost of transporting the corn from central Brazil where corn is in surplus. Corn prices are now more manageable and the potential for additional pork exports to Russia comes as welcome news for Brazil's hog producers.