The outlook for the Brazilian poultry industry in 2016 is broadly positive, believes the Brazilian Association of Animal Protein (ABPA).
The association forecasts that, despite an unfavorable economic environment at home, broiler production will end 2016 approximately 3-5 percent higher, while egg production will rise by 2 percent.
The Brazilian broiler sector has entered the new year after a particularly mixed 2015, with the sector facing higher input costs, but achieving record exports.
Figures released in late 2015 indicate that Brazil’s poultry meat production for the year was 3.5 percent higher at 13.14 million tonnes. This was driven by a small rise in consumption on the local market - with per capita poultry meat consumption up by 1.05 percent to 43 kg - and by strong demand from overseas.
At home, Brazil’s poultry meat producers benefited from the high price of beef, forcing consumers to look for cheaper alternatives, although per capita chicken meat consumption levels still remain below those of 2012. Against this positive scenario, however, the sector had to cope with higher soya prices particularly during the second half of the year, higher chick prices and industrial action.
For 2016, total broiler meat production is expected to be rise by between 3 and 5 percent, driven by rising exports and a hoped for improvement in the economic situation on the home market.
Yet, the nation’s economic outlook remains poor, and the political environment difficult, suggesting that there may not be an improvement in the Brazilian market anytime soon. Coupled with this, world markets remain far from stable, particularly the Chinese market, which has grown in importance for Brazilian producers.
Despite growing overseas sales, the home market remains the principal destination for Brazil’s poultry, accounting for approximately two-thirds of sales.
Brazilian poultry meat exports
The volume of poultry meat exported by Brazil this year is expected to rise by similar levels to the country’s overall production, with the most optimistic forecasts suggesting growth of 5 percent, and more negative predictions arguing the increase in export volumes will be 3 percent.
2016, the sector hopes, will not see a repeat performance of the strikes that hampered the sector in 2015, with transport disrupted in February and October, and federal livestock inspectors downing tools in September. Both industrial actions disrupted the flow of chicken meat to export markets.
Record breaking performance
Figures released in January show that, in 2015, Brazilian poultry meat exports broke all records to reach 4.304 million tonnes, an increase of 5 percent on 2014. By value, however, exports were worth US$7.170 million, a decrease of 11.3 percent, due to the devaluation of the real.
The sector started the new year with a number of new export opportunities, as 2015 saw the opening of more overseas markets, particularly Malaysia and Myanmar.
As important, is the Chinese recognition of two more poultry processing plants as being fit to export, bringing the total number of processing plants recognized by the Chinese authorities to 30. The Mexican government recognized 16 poultry processing plants last year as being of a high enough standard to export, bringing the total number of Mexican-certified plants to 20.
These additional recognitions will stand the industry in good stead as 2016 progresses, but the sector has further targets in its sites.
“We have positive expectations for accessing to the Dominican Republic and Taiwanese markets, along with more plants gaining certification to export to China,” commented ABPA’s vice-president of poultry Ricardo Santin. “Australia, New Zealand and Cambodia are also on the sector’s radar, and we are following the panel opened against Indonesia.”
Growth in Brazilian egg production is expected to be in the region of 2 percent this year, significantly lower than the 6.1 percent recorded in 2015, when output stood at 39.5 billion units. The ongoing difficulties in the country’s economy are expected to favor egg consumption as consumers look for cheaper sources of protein, and egg prices are predicted to rise slightly.
2015 not only closed with the expectation that the country’s per capita egg consumption would reach a record high of 191 units, but also with the opening of the Japanese market to Brazilian egg exports.
The country’s 2015 egg exports are thought to have been in the region of 20,700 tonnes, an increase of 70 percent by volume. This is thought to have been worth US$26 million, an increase of 54 percent, while in the increase in local currency is thought to have been in the region of 120 percent.
The number of eggs exported in 2016 is expected to be broadly similar to that of 2015, but Saudi Arabia and the United Arab Emirates being particularly important markets.
Strike action halted shipments out of Brazil’s main export port Itajai last year, dragging down sales. The sector hopes improvements to the country’s economy will help to ensure that a similar scenario does not emerge this year.