MercoPress. South Atlantic News Agency

China opens to Brazilian pork and meat distribution hubs in six main cities

Pedro de Camargo Neto president of Brazil’s Pork production and export industry

China opened its market to Brazilian pork and Brazil’s meat packer Marfrig said it would invest heavily in distribution centres in China. The announcements were made in Beijing where a numerous government and private sector delegation headed by Brazilian president Dilma Rousseff is on an official visit to China.

Three out of thirteen abattoirs have been selected for exporting pork to China. “We were expecting more, but it’s a beginning” admitted Pedro de Camargo Neto, president of Brazil’s Pork production and export industry, Abipecs.

The abattoirs were inspected by a Chinese sanitary delegation last November and the Brazilian pork industry was expecting that given the presence of President Rousseff, Chinese authorities would have extended the export certification to the thirteen abattoirs.

China is the world’s leading producer and consumer of pork. Negotiations to have access to the Chinese market have been ongoing since 2009, although some Brazilian pork does reach continental China through Hong Kong, where the Brazilians have a strong foothold.

Representatives from Marfig Alimentos, the world’s largest meat corporation said that through its subsidiary Keystone Foods it would be participating in two joint ventures with Chinese companies with the purpose of exploring opportunities to supply food products and meet the growing demand for distribution in the Chinese market.

The first of them is with COFCO (China’s government food export-import corporation) and will concentrate on distribution with the construction of six hubs, plus transport fleets in China’s six strategic cities. The project takes off in 2012 and will involve 252 million US dollars.

The other is with Chinwhiz Poultry with the purpose of implementing a vertical integration in poultry operations in China .The joint venture will initially have a processing capacity of 200,000 chickens per day and will be able to supply 50% of the raw material needs of Keystone's processing unit in China.

The unit already serves over 2,600 restaurants in China, Hong Kong and Japan. The role of Keystone will be to use the knowledge it gained from managing similar vertically integrated operations in the US. The investment in the poultry joint venture is estimated at 57 million US dollars over a two year period.

“With these investments, Marfrig will be strategically positioned to meet the growing demand for food in the Chinese market, with operations that range from processing to distribution to clients”, said an official release from Marfrig distributed in Sao Paulo.