BRF says new Saudi rules on chicken shelf life could hurt sales
Reuters reports that the proposed restrictions, communicated by the Saudis to the World Trade Organization (WTO), would reduce the shelf life of frozen chicken to three months from a year ago, potentially disrupting BRF’s ability to serve this market, Luz said in a call to discuss the company’s first quarter results.
BRF, which is Brazil’s largest chicken processor, operates through partnerships with local Saudi companies and also exports products to the kingdom from Brazil.
If implemented, a shorter shelf life of frozen chicken products would impose logistical challenges for both local suppliers and foreign exporters based in countries like France, Ukraine and Brazil.
“Jeddah, Saudi Arabia’s main port, is about 1,000 kilometers from the country’s capital, Riyadh,” said Patricio Rohner, a BRF executive who oversees international markets. “Local and overseas suppliers will have to adapt if this becomes the new standard.”
In a statement to ReutersThe Brazilian meat lobby ABPA has said that the proposed reduction in the shelf life of chickens in Saudi Arabia is a decision of “potential protectionist nature.”
The proposed rule change comes less than a week after Saudi Arabia banned imports from 11 Brazilian poultry factories without warning or explanation, a move that mainly affected JBS SA in Brazil.
On May 11, BRF said Saudi authorities notified the WTO of the proposed change to the shelf life of products, which is not yet in effect. The BRF said it would consult with authorities on measures that could be taken in accordance with WTO rules following the Saudi ruling.
Members of the trade body affected by the measure have 60 days to comment, BRF said.