The company currently has four production facilities in the region
Brazilian food processor BRF FA has agreed to invest $120 million to build a chicken processing plant in Saudi Arabia to bolster its presence in the Middle East, according to media reports.
The company currently has four production facilities in the region, and currently serves the Saudi market through eight facilities in Brazil and a factory in Abu Dhabi.
The location, investment schedule and capital structure of the facility will be determined at a later date, the BRF statement said.
Responding to questions from Reuters, BRF chief financial officer Carlos Moura denied that the move was pre-emptive measure against protectionism.
“The BRF move is that of a protagonist. It is not purely and simply defensive. We have a long history in the region,” he said.
While the bulk of the new plant’s estimated output of 50,000 tonnes will be for earmarked for the Saudi market, but can also be sent to nearby countries.
The facility’s product portfolio is also expected to include bread, marinated products and burgers. It will begin operating by the end of 2021.
According to USDA statistics, Saudi chicken output is forecast at 730,000 tonnes in 2019, a figure that is expected to increase to 750,000 tonnes next year.
Saudi chicken consumption is estimated at 1.33 million tonnes and is forecast to reach 1.38 million tonnes next year.