Division of Cargill cocoa in Brazil raises export

In lean times, chocolate is luxury item. And that's why, in the face of a drop in income in Brazil and a less promising consumption, external market becomes more alluring to the cocoa industry installed in the country. At least this has been the bet of the American multinational Cargill, which has increased the participation of exports in their sales of cocoa derivatives like butter and dust produced in its plant in Brazil-and that, last month, starred in the first shipment of cacao beans in the country in about 20 years.
Exports of oil products have always been present in the company's strategy in Brazil, but until the middle of last year were not a priority. "The change of focus started since we realized this panorama of the Brazilian market, in the 2014 World Cup," says Miguel Sieh, Director of the cocoa business unit of Cargill in Brazil. The company is one of the four largest almond processors in the country and this year was responsible for almost half of imported cocoa until October. Last year, exports of oil products accounted for 25% of the volume sold by the company, while from January to November this year to slice up to 30%.
Although this difference is relatively small, to turn to the international market goes against the original proposal of Cargill, who set up a structure aimed at giving cocoa by-products to the national industry of chocolates and confectionery. Still, this transition occurs at an auspicious moment for Brazilian exports, azeitadas by the over-use of the dollar against the real in this year, and in the face of strong demand in the Mainland, especially in Argentina and in the United States.
The weakness of the domestic consumption was also one of the factors that allowed the Cargill perform shipment of 6.6 tons of cocoa beans in October, the first Brazilian almond exports since the beginning of the Decade of 1990. In the last 20 years, the country has stopped exporting the commodity because of the attack of the broom to the plantations of Bahia, which overthrew the national production of a level of 400 thousand tons in the 1980 to approximately 120 thousand tons in the early 2000.
Sieh points out that the October shipment on time, being very difficult to predict when this luck will repeat. "We're still pinching ourselves here," says the Director of the company. However, although isolated and insesperada, the occurrence was enough for Cargill record so far this year a positive trade balance, since imports were only 5 million tons since the beginning of the year--well below the 18 million tons imported by the company last year.
The completion of loading and this fall in imported volume of cocoa does not explain only by tibiez of industrial demand. A factor that strongly influenced was the increase in national production of cocoa harvest 2014/15. This year, because of a series of climatic factors, the harvest of early crops of Bahia, which usually lasts from May to September, was concentrated in just two months, dumping most of expected production in a window of time too short for that industries could absorb all the supply of raw material.
The volume was also higher, and many industries have had difficulty in finding space to store as much almond cocoa out of crops. The TH consulting, headquartered in Salvador, estimated that the harvest of early crops of the season 2014/15 in Bahia has stayed at about 1.6 million bags, compared with the 1.3 million bags in the previous cycle. And, unlike other crops, cocoa cannot be stored for long, says Sieh.
This surplus of supply changed the correlation of prices in the Brazilian market. As in the past two decades the national production was below the demand of industries, the commodity was being sold in the domestic market for general values higher than those charged on the New York Stock Exchange. "This is another reason why it is not exported in the past," says Sieh.
This year, however, the abundance of the harvest allowed the cocoa was negotiated with discount in the country. Coupled with the stimulus of the devaluation of the real, the Brazilian cocoa became thus more competitive this year for international buyers. The shipment carried out by multinational was also facilitated because the load was destined to a company related to Cargill processor in the Netherlands.
These factors, however, do not guarantee that Brazil will be a supplier of cocoa to other countries in the short-term. Sieh says that, after some 20 years of absence of Brazilian cocoa in the world, consumers in other countries if desacostumaram with the taste of national almond. "If the international market uses Brazilian almond for a while, it's not a time for another trading the almond used to use by Brazilian," he says.