Brazil’s poultry production is forecast to rise 3 percent in 2016 to 13.5 million metric tons, beating last year’s record production level of 13.1 million metric tons, according to a World Poultry report. Booming broiler exports as a result of the depreciation of the Brazilian currency, along with new market opportunities, are the main drivers behind Brazil’s poultry production growth.
A devaluation of the Brazilian currency of 53 percent in the last 12 months, ending in January 2016, makes Brazilian broilers highly competitive in the world market, resulting in record exports of broilers. With chicken meat remaining the cheapest animal protein in Brazil, the poultry industry in Brazil remains the bright spot in the animal protein sector.
Although current market conditions in Brazil favor a shift from high-priced beef to lower-priced chicken, rising inflation, and loss of consumer purchasing power, indicates that no further increase in domestic consumption is expected in 2016.
The forecast production of 13.5 million metric tons in 2016 reflects the current expectations of producers to continue with a strategy to adjust supply and demand for broilers and to respond to higher world demand for Brazilian broilers, especially because of the continued impact of avian influenza in several producing companies.
Uncertainty regarding feed costs is considered to be the main constraint affecting producer margins in the 2016 forecast. Brazilian corn exports are currently booming and prices have increased in the past 12 months in the most important poultry producing areas of the south by nearly 50 percent for corn and 18 percent for soybean meal.
Broiler exports from Brazil exceeded expectations in 2015 and is estimated to continue grow in 2016 by nearly 8 percent over last year’s record. The devaluation of the Brazilian currency, along with the continued impact of avian influenza in several producing countries, has substantially increased demand for Brazilian poultry.
In addition, Brazil opened two new markets for poultry in 2015–Pakistan and Myanmar and were successful in expanding the list of poultry plants for other markets, such as Russia, China, Malaysia, and Mexico. Brazil is now able to export broiler meat to 158 countries, although nearly 70 percent of all poultry exports are concentrated in 10 countries.
