AGRICULTURE NEWS

FREIGHT AVAILABILITY CONTINUES TO WORRY BRAZILIAN PREMIX COMPANIES AS OTHER COVID-19 RELATED CONCERNS DIMINISH

As we start 2022, some concerns which troubled Brazilian animal nutrition companies in 2021 remain. However, some fears previously experienced by premix sector players seem to be diminishing. Lauriston Bertelli, Director RD&I at Premix Ltda., told that worries over higher costs of raw materials and labor availability are no longer major concerns for the company. “It is unlikely we will have a significant increase in the cost of raw materials this year, since these are already at their top-limit. What may affect production prices are the US dollar forex and delays of these supplies,” says Bertelli. For Sergio Beppu, Supplies Director at Vaccinar, however, concerns still exist, with many uncertainties regarding the behavior of foreign governments in relation to the Omicron variant. “China, for example, has adopted a zero-tolerance policy in relation to COVID cases, leading important regions for the production of raw materials for the animal nutrition segment to adopt lockdown regimes, causing insecurity and resulting in volatility in the prices of many raw materials,” says Beppu. As for labor availability during the latest surge of coronavirus infections, Clodys Menacho, Commercial Director at Alltech Brasil, says COVID-19 was never an obstacle, but rather ‘a great challenge’. One thing that concerns Bertelli, however, is a possible disruption of maritime freight supply: “The lack of containers is something that continues to haunt us.” As for the outlook for 2022, executives’ opinions were positive. “What we really need is for the domestic market to grow. If inflation subsides and average income in Brazil increases, we should see an increase in the domestic market for meats, which for us would be great since it would increase the demand for premix and additives,” states Bertelli. “Demand around the globe for food, and in particular for protein of animal origin, is growing. The search for more productivity and economic returns will certainly boost companies that invest in new technologies and innovations. In this context, feed supplements, premixes and additives should enjoy great advances in the coming years,” adds Sebastião Aparecido Borges, Director of Nutrition at Vaccinar.