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Record Poultry Production Forecast in Mexico Despite Flu Concerns

15 April 2016

MEXICO - Commercial production is forecast at a record 3.3 million tons in 2016, as relatively low and stable feed prices have enticed producers to spur production, according to a recent report from the USDA's Foreign Agricultural Service (FAS).

Nevertheless, feed prices continue to represent a significant portion of cost of production.

Recent data from the National Poultry Union (Union Nacional Avicola - UNA) indicates that the poultry sector, comprising broiler, turkey, and eggs, grew 4.1 per cent during 2015.

The sector is still concerned about the threat from Highly Pathogenic Avian Influenza (HPAI) and the potential appearance of new Avian Influenza (AI) virus strains.

The most recent Low Pathogenic Avian Influenza (LPAI) H5N2 outbreak occurred in the northern state of Sinaloa and Mexican zoo-sanitary authorities quarantined egg layer farms and culled around 430,000 birds. Since then, several outbreaks of highly pathogenic flu have also been reported.

Costs associated with biosecurity requirements are increasing, according to the report.

Consumption is forecast at a record 4.08 million tons as increased production and affordable prices solidify broiler meat’s position as consumers’ preferred protein.

The 2016 forecast represents the sixth consecutive year of record consumption. Although prices will not be as low as in the past, broiler meat will continue to be the most affordable source of animal protein, especially for low-medium income consumers.

Demand for chicken leg quarters (CLQs) and mechanically separated/deboned poultry meat will remain strong. However, increased consumption will be primarily supported by expanding domestic production.

Imports are forecast slightly higher at 790,000 tons on strong demand for mechanically separated/deboned meat by Mexican processors and chicken leg quarters (CLQs) by various channels.

A significant portion of imported product is destined for further processing and demand for these products remains resilient.

Virtually all of Mexico's chicken and turkey meat imports originate from the US. However, Chile and Brazil continue gaining market share.

Given the recent amendment to the term of length to import poultry meat duty-free and according to private sources, Argentina is likely to become a competitor in the Mexican market during 2016.

ThePoultrySite News Desk

Top image via Shutterstock

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