Brazil is the world's leading halal meat exporter

Brazil’s meat industry has taken plenty of hits in the past couple of years. It all began in March 2017, when the Federal Police launched Operation Weak Flesh, uncovering a corruption scheme within the Ministry of Agriculture to defraud sanitary permits and allow big meat producers to sell spoiled products. Since then, two other police operations have been carried out, and Brazilian meat exporters have been forced to endure restrictions in several international markets.

But a diplomatic move planned by President-elect Jair Bolsonaro, which has nothing to do with meat exports, could have an even worse impact on the sector. Throughout his campaign, Mr. Bolsonaro stated multiple times that he intends to relocate the Brazilian Embassy in Israel from Tel-Aviv to Jerusalem – something he recently confirmed in an interview with conservative news outlet Israel Hayom. This would be yet another Trump-esque move from a politician to loves to compare himself to the U.S. president (who announced the relocation of the American Embassy in December 2017).

In Brazil, the move is not a demand from the Jewish community, but rather comes from evangelical leaders. Brazilian evangelicals argue that the Bible specifies Jewish people are the chosen ones, and therefore Jerusalem is the capital of Israel. For them, Israel’s claim over Jerusalem must be recognized for the new messiah to emerge.

However, that would create a major problem for meat producers, as Brazil is the world’s number one producer of halal beef and poultry, products which adhere to Islamic law, as defined in the Quran. Brazil currently exports about 2 million metric tonnes of meat to 57 Islamic-majority countries (22 of which are Arab countries).

By siding with Israel, Brazil could burn some bridges with some of its key exporting markets, which has become all the more sensitive since the Weak Flesh scandal. Over the weekend, the Qatari Ministry of Foreign Affairs issued a statement asking Mr. Bolsonaro not to carry out his intended relocation, saying that, if implemented, it would be “a departure from the international consensus, which was reflected in the UN General Assembly’s refusal to recognize Jerusalem as the capital of Israel and its call on all countries to refrain from establishing diplomatic missions there.”

Halal meat in Brazil

Halal meat plant brazil

Halal meat plant in Minas Gerais.

In Brazil’s largest meat plants, it is not uncommon to see workers speaking in Arabic and wearing Muslim clothing such as the ghutrah headscarf. Over 500 factories in the country are specialized in this type of meat. The Islamic form of slaughtering animals or poultry, dhabiha, involves killing through a cut to the jugular vein, carotid artery, and windpipe. Animals must be alive and healthy at the time of slaughter and all blood is drained from the carcass. During the process, a Muslim will recite a dedication, know as tasmiya or shahada.

“Brazil has created strong ties with Islamic communities over the past decades and today is one of the most open countries to our traditions and customs,” declared Ali Saifi, executive-director of Cdial Halal, the main halal certifier operating in the country.

Brazil’s main meat exporters have for long had their eyes on a booming market. Muslims account for 25 percent of the world’s population and, according to the Pew Research Center, this population should rise by 73 percent by 2050, reaching 2.76 billion people. The halal economy will generate USD 6.4 trillion in revenue this year – doubling 2012 figures.

Companies also started to pay special attention to Islamic-majority countries after the European Union slapped restrictions on Brazilian meat, following successive sanitary issues. One success story is BRF. Despite its turmoil in Brazil, the company has managed to control 45 percent of the poultry market in Saudi Arabia, United Arab Emirates, Kuwait, Qatar, and Oman through a Dubai-based subsidiary called One Foods.

New markets

The Middle East is not Brazil’s only consuming market for halal products. Asia has become a main target for producers, and Minister of Agriculture Blairo Maggi announced earlier this year that negotiations with South Korea and Indonesia (home to the largest Muslim population in the world) were in their final stages. South Korea – where 740,000 Muslims have traveled to last year – is already Brazil’s sixth-largest meat consumer.

Another country where halal is booming is China. The segment should generate USD 1.9 trillion in revenue by 2021, even if only 2 percent of the country’s population is Muslim. Halal food, however, has been sold as a healthier alternative, gathering about 26 million consumers – who have spent USD 20 billion.

According to Brazil’s Association of Meat Exporters (Abiec), Brazil’s halal meat exports to Arab countries have risen by 6.6 percent in 2017 from 2016, generating USD 1.6 billion. That’s 25 percent of Brazil’s beef exports. Interfering with that market could soon turn producers against the future government.

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MoneyNov 05, 2018

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BY The Brazilian Report

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