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USDA International Egg and Poultry


17 September 2014

USDA International Egg and Poultry: BrazilUSDA International Egg and Poultry: Brazil

A strong export demand and lower feed costs are expected to drive an increase in broiler meat production in 2015. Unofficial broiler production projections for 2015 are 13.3 million metric tons, up 5% from 2014 (12.7 MMT).
USDA International Egg and Poultry

Higher exports are expected due to the depreciation of the Brazilian currency, lower feed costs due to forecast record soybean and corn crops estimated for 2014/15 crop year, and higher world demand for the Brazilian product, especially from the Russian Federation. The outlook for turkey production and exports is for moderate growth next year. (All projections for 2015 are unofficial.)

Producers are expected to continue with a strategy to adjust supply and demand for boilers and to respond to higher world demand for the Brazilian product, especially from the Russian Federation. Producers are likely to benefit from reduced production costs due to higher soybean and corn crops in the 2014-2015 season.

The cost of broiler production in 2015 is estimated to drop by 5% from last year’s level, while producer prices will likely recover around 6% during the same period. If this materializes, these prices will contribute to improved profit margins next year. These reference prices are for Parana state, the largest broiler producer in Brazil with a market share of nearly 28 percent of total broiler slaughter.

Domestic consumption of broiler meat in 2015 is projected to increase by over 2% reflecting a continuing increase in the broiler price (RTC) due to higher expected inflation rates, the high indebtedness of Brazilian consumers, and competition from beef and pork.

Broiler exports in 2015 are expected to increase by 11%. The growth in exports is likely to be driven by a continued devaluation of the Brazilian currency combined with an additional market opportunity for higher sales to the Russian Federation. Broiler exports in 2015 are expected to increase by 11%. According to Post trade sources, 38 Brazilian slaughter plants are currently eligible to export broilers to the Russian market. This would allow Brazilian poultry processors to increase their supplies up to 30,000 metric tons per month early in 2015. Brazilian trade sources also forecast higher sales of chicken parts to China in view of a higher number of plants (29) approved for that market. Other promising markets for 2015 are Japan, Egypt, Nigeria, and Mexico.

Turkey production is forecast to increase by 5% in 2015, mostly driven by a rebound in exports. Lower feed costs due to forecast record soybean and corn crops during the 2014-2015 season are likely to improve producers’ margins. A slowdown in the growth path of domestic demand remains as the main constraint affecting production growth.

Turkey exports are projected to increase by 11 percent in 2015, mostly caused by the depreciation of the Brazilian currency. Exports are expected to increase to the European Union, Angola, Peru, the Russian Federation, and Chile, and likely Mexico.

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