Brazil's BRF to up direct grain purchases in bid to boost traceability

Credit: REUTERS/RODOLFO BUHRER

By Roberto Samora

SAO PAULO, Dec 1 (Reuters) - Brazilian food processor BRF BRFS3.SA plans to increase its direct purchases of grain from farmers to 40% of its total by next year, as it seeks to increase control over its production chain while trying to reach traceability goals, executives said.

The pork and poultry processor, one of Brazil's largest buyers of corn and soybeans, bought 17% of the material used to make feed directly from producers last year, and 32% in 2023.

To expand direct purchases, the company has adopted measures such as moving employees from the corporate segment to units in the countryside, reinforcing grain purchasing staff in states such as Mato Grosso, Mato Grosso do Sul, Goias and Minas Gerais.

BRF also unveiled an updated goal to have 100% traceability from direct and indirect suppliers by 2025, Director of Reputation and Sustainability Raquel Ogando told Reuters.

The firm already has 100% traceability of direct grain suppliers in the Amazon and Cerrado biomes, while this year it will increase traceability from indirect suppliers to 75%, from 45%.

Ogando also said that BRF has set the end of 2025 as its target to end grain purchases from legally deforested areas of the Brazilian Cerrado biome.

Under Brazilian legislation, farmers have the right to deforest part of their property, with limits varying according to the biome.

But the director stressed that BRF will not work with grains from legally deforested areas of any biome from 2026 onward, pointing out that the firm has not bought from deforested areas in the Amazon since 2008.

"We set 2025 as the cut-off date, in line with the principles of SBTi (science-based targets)," said Ogando.

(Reporting by Roberto Samora; Editing by Kylie Madry)

((Peter.Siqueira@thomsonreuters.com; +55 11 56447727;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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