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Preocupa a avicultores mexicanos devaluación del peso
Benjamín Ruiz
on September 21, 2016

Mexican poultry producers concerned with peso devaluation

For the first time the Mexican peso has crossed the exchange rate barrier of 20 pesos per dollar, when 65 percent of chicken and egg production costs are coupled to the US dollar.

The sharp slide the Mexican peso is experiencing against the U.S. dollar is impacting production costs in the Mexican poultry industry, according to Cesar Quesada, president of the National Poultry Producers Association (UNA).

On September 19, the dollar exchange rate reached MXN20 per US$1. Although it explains that the economy is in a time of high volatility the effect it is having on different production activities, such as poultry, is not very flattering.

In an analysis carried out by the UNA, from August 2013 to August 2016, in which the impact of the exchange rate behavior was reviewed, the per dollar exchange rate went from MXN12.90 to MXN18.46, an increase of 43.11 percent.

"This increase in the dollar value, negatively impacts the poultry industry, and it is important to note that poultry producers have not moved that cost to the selling price," Quesada said.

The concern is based on the fact that 65 percent of chicken and egg production costs are dollarized, he added.

The deterioration of the Mexican peso against the U.S. dollar is a factor that can lead to a lack of competitiveness in the Mexican poultry industry concluded, Quesada.

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