Brazil's BRF, JBS involved in higher feed costs, lower export premiums in Q3

[caption id="attachment_5705" align="aligncenter" width="1014"] File Photo[/caption] High grain costs on protein processors such as BRF SA and JBS SA were seen to weigh, while they reported third-quarter results next week due to the strong export market over a three-month period. While China remained a key export destination buying ever-larger meat volumes from Brazil and other origins, it is now paying lower premiums, according to a Nov. 2 report from HSBC analyst Alessia Apostolatos. “The weaker Brazilian real is a double-edged sword that has made Brazilian protein exports more competitive globally, but also increased input costs,” Apostolatos said. “China has been able to negotiate lower prices and absorb higher quantities as it continues to face African swine fever (ASF) pressures.” Chicago soy futures hit a four-year high this week as dry weather spurred supply concerns in top producer Brazil. Corn, another key livestock feed ingredient, soared 46% in local currency over the third quarter. But the impact of higher input costs is different for JBS and BRF, given their distinct product portfolios and production base, Banco do Brasil analyst Luciana Carvalho said in an interview on Friday(Nov 6, 2020). Find more... Source: Online/SZK