Weekly Update | April 22, 2011 When Dilma Rousseff, Brazil’s new president, visited China recently, the business delegation travelling with her hammered out several deals. One of the success stories of the trip was the Brazilian meat production industry. Here’s a quick roundup of the Latin American industries and 3 stocks that might also benefit from this. China’s burgeoning population and rising wealth has increased demand for food which can only be met through imports at this stage of the country’s development. Take a closer look at beef imports into China. China’s beef imports are expected to jump 38% to 55,000 metric tonnes (MT) in 2011 from 40,000 MT in 2010. Where’s the beef? It will come from Latin American nations, like Brazil and Uruguay which should benefit most from the higher beef imports by China. Until 2008 Argentina was among the world's top beef exporters. However, now Argentina 80% of its production stays domestically, due to Argentine government sanctions on beef exports. As a result, smaller regional peers such as Paraguay and Uruguay have been able to surge past that nation in beef exports. China also needs pork. It accounts for 50% of global pork con-sumption. This demand will support pork imports of 1 million MT this year, an increase of 20% over 2010 levels. Within the next four years, Brazil’s annual pork exports to China are expected to touch 200,000 MT (slightly under 40% of its total exports in 2010). This will compete with Russia and Hong Kong’s demand which accounted for over 61% of Brazil’s pork exports in 2010. And demand for pork and beef is growing in other areas too. Additionally, the European Union’s proposed free trade agreement with the Latin American trade block (MERCOSUR), allowing import of various types of meat such as beef and pork, creating high-end opportunities for producers into Europe over the next few years. But it may not take years for the effects to be felt. All this demand is likely to be putting upward pressure on global beef and pork prices and production soon. Among the ADRs that might benefit are the following:. 1) BRF Brasil Foods SA (NYSE:BRFS) emerges as a clear winner here on this recent deal, given that the company accounts for 40% of Brazil’s pork exports. The company’s stock has been a trail blazer on the bourses, notching up a string of new 52-week highs in recent weeks. 2) Cresud Inc. (NASDAQ:CRESY) in the medium term. In addition to its Argentine operations it also owns 36% of Brasil Agro which uses the same agricultural land de-velopment model to create value in Brasil. 3) Chile’s Sociedad Quimica y Minera (NYSE: SQM), a major producer of plant-nutrients whose Latin American operation include facilities in Brazil, Mexico, Peru and Ecuador, as well as Chile. Its products are also dis-tributed throughout North America, Europe, the Middle East, Africa, Asia and Australia. Given that land prices are rising, productivity is becoming a more crucial element, so expect fertilizer prices to also rise. To put it in a nutshell, I believe that demand from China will dictate the fortunes of the beef and pork industry in Latin America in the near future. It also will create some profit making opportunities are a variety of stocks supplying agricultural products and services. For my specific picks, read the recommended stocks in the attached model portfolios. And check in next week for which agri-cultural ETFs might benefit from the rising global trade. Happy trading! Rudy The leading Latin American stocks last week were: Companhia de Bebidas das Americas (NYSE:ABV) +6.5% Compania Cervecerias Unidas S.A. (NYSE:CCU) +6.0% Ecopetrol SA (NYSE:EC) +5.6% MercadoLibre Inc. (NasdaqNM:MELI) +5.5% NII Holdings Inc.(NasdaqGS: NIHD), +5.3% If you can not see the file download button and link below for this posting it is because you are not logged in. Login or subscribe to see and download the latest trade ideas. It takes only 2 minutes to subscribe.