Brazil, US tainted poultry debacles open door for producers in Vietnam

The limits have reduced the potential for major US chicken companies such as Tyson Foods Inc (TSN.N) and Pilgrim’s Pride (PPC.O), to sell poultry overseas in the Japanese and other markets that quickly followed suite in limiting imports of US poultry.

Meanwhile, Japan has also suspended chicken imports from a meat-processing plant in Brazil following a rotten meat scandal, a spokesperson of the Japanese agriculture ministry noted.

The ban affects imports from one of the 21 Brazilian plants that have come under fire after federal police revealed earlier this year that public officials were bribed by senior business executives of poultry and meat producing companies to approve the sale of contaminated meat in foreign markets.

In 2015, nearly 76% (430,000 metric tons) of Japan chicken and meat imports came from Brazil, Japanese government spokesperson Yoshihide Suga said at a press conference, adding that of this, a significant portion came from the plant hit by the scandal.

Japan has also suspended imports of other products – such as honey – from these plants, and is mulling further measures, added the spokesperson.

In addition, Japanese authorities are considering tightening restrictions yet further to ensure future food safety.

Other markets that have prohibited Brazilian poultry and meat imports include Hong Kong, China, the EU and Chile.

Largely because of the problems experienced by the Japanese and other countries ban on imports of chicken from Brazil, Thailand production and exports are forecast to further grow in 2018, the US Department of Agriculture said in a report.

According to the report, Thailand chicken exports are estimated to grow sharply by 12% to 770,000 metric tons in 2017 largely due to increased Japanese purchases from Thai suppliers following the spoiled meat scandal in Brazil.

The Brazilian poultry dilemma has also spilled over and opened the door a crack for Vietnam chicken farmers and producers, said Nguyen Quoc Toan, deputy head of the Department of Farm Produce Processing and Market Development.

A representative of Koyu & Unitek Ltd Co, said his company has recently received approval to export chicken to Japan. He noted his company expects to ship roughly 2,000 metric tons of product to Japan in 2017. 

The Koyu & Unitek Co Ltd opened a meat processing plant in March 2017 that has a capacity to process 50,000 chickens daily at the Long Binh Industrial Zone in southern Dong Nai Province as part of its plan to export poultry products to Japan.

The US$6 million plant is equipped with advanced machinery imported from Japan and operates following strict hygiene and food safety standards, noted the company representative.

The facility is expected to scale up to 720,000 chickens by next June or July, said the rep. Most of its breeds have been imported from France, while feed is being produced by De Heus Vietnam.

Though 2,000 metric tons is an inconsequential export figure in the overall global poultry market, it represents an opening of the door a crack, said the rep— that hopefully the company will be able to capitalize on for long-term benefit.