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on October 19, 2016

Pig, broiler production costs decline continues in Brazil

For the third consecutive month, Brazilian agencies report falling production costs.

For the third consecutive month, Brazil’s broiler and pig farmers’ average costs of production dropped.

Figures published by CIAS, the Central Intelligence Poultry and Swine with the Brazilian Agricultural Research Corporation (Embrapa), the production costs fell by 3.6 percent and 5.2 percent, respectively, for farmers of broilers and pigs last month.

Pig production costs in Brazil

The score for pig production costs (ICPSuíno) stood at just under 234.0 in September, down from 246.7 the previous month. The index has risen by 14.7 percent so far in 2016 and stands just under 19.2 percent higher than at the same point in 2015.

Broiler production costs in Brazil

For broilers, the index (ICPFrango) decreased from 219.3 points in August to 211.5 in September. Despite the series of recent falls, September’s figure represents an increase in total costs of 6.3 percent so far in 2016, and of just over 11.0 percent over the last 12 months.

Causes of pig, broiler production costs drop

As in previous months, most of the overall reduction in costs can be mainly attributed to lower corn and soybean prices. For broilers, the average feed cost in September was down by more than 3.2 percent from the previous month; for pigs, the reduction was a little over 5.0 percent. Current feeding costs remain significantly higher than at the start of 2016 and one year ago. Other production costs were the same as in August or changed only marginally.

The indices of production costs were created in 2011 by socioeconomics team of Embrapa Swine and Poultry and the National Food Supply Agency (Conab). The ICPFrango score represents typical broiler production costs for a ventilated poultry shed in the state of Paraná, while ICPSuíno is based on a typical full-cycle pig production system in the state of Santa Catarina.

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