SAO PAULO (Oct 21): Brazil raced to contain the trade fallout from the detection of a highly contagious bird virus, as poultry shipments to countries including top buyer China faced restrictions.

Brazil said Monday that Newcastle disease was identified at a commercial turkey unit in the state of Santa Catarina. The discovery prompted a restriction in trade with several partners, raising the risk of disruptions from the world’s largest poultry exporter that is also home to meatpacking giants including JBS NV and MBRF Global Foods SA.

So far, however, the impact has been fairly limited. Brazil briefly suspended all poultry shipments to China before negotiations resulted in restrictions covering only Santa Catarina. In other major markets including Saudi Arabia, South Korea and the UK, even narrower limits were imposed, around the affected area. 

In a previous outbreak of the disease in 2024, Brazil had to halt shipments to China and the European Union. On that occasion, it took 18 months before trade with China was fully restored, with authorities clearing shipments from the state where the virus was detected.

“Unless we see a widespread event happening — which is unusual for this disease and Brazil’s Ministry acted fast to contain spread — we think the impact could be even smaller” amid the limited restrictions, JPMorgan analysts led by Lucas Ferreira wrote in a note. 

Newcastle disease attacks the respiratory, nervous and digestive systems of birds. While there’s no evidence that the virus could be transmitted to humans by food, it is typical that importing countries set protocols for shipments, partly as a way of protecting their own producers. 
The virus was found in a turkey that did not present any symptoms, according to Brazil’s Animal Protein Association, or ABPA. To prevent the virus spread to the flock, authorities ordered the culling of all 6,000 animals in the affected production facility.

Santa Catarina is Brazil’s second-largest supplier of chicken, accounting for roughly 23% of all exports this year through September. Meatpacking companies with plants there may seek to use other plants outside the state to continue serving countries that imposed restrictions.

“The market is seeing very strong demand, and exports will grow this year,” said Ricardo Santin, president of ABPA.

In China’s case, an agreement between the two nations required Brazil to “self-embargo,” although authorities from the Asian nation have the ability to lift or ease restrictions, Santin said.

The situation differs from market to market. Brazil halted all poultry shipments to Malaysia, while Mexico also suspended imports of Brazilian poultry. On a more limited basis, Brazil has restricted shipments from Santa Catarina state to Kazakhstan and Chile, in accordance with sanitary agreements with those countries. 

Restrictions are even narrower for some other destinations, with bans limited to processing plants located near the area where the virus was detected. Those measures apply to countries including Argentina, South Africa, Saudi Arabia, the UK and South Korea.

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