September 1, 2010
by John Rumsey
Two years ago the Brazilian meatpacking industry was a dogs dinner. There were far too many small competitors fighting for market share. That led to dumping on the home market: cut price filet mignon predictably led to a chain reaction.
Retail prices for other beef cuts were culled, followed by those for pork and then chicken, notes Gustavo Wigman, food analyst at Goldman Sachs in São Paulo. That was coupled with a tight market for cattle, which compressed margins in the sector, he notes.
The industry was ripe for consolidation. Indeed, since the start of 2009, 10 meatpackers have sought judicial protection from creditors. They include Independ&
After two years of breakneck growth and consolidation funded largely by the government, Brazilian meatpackers are protein providers to the world. Can they also become global brands?