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Latin America Poultry at a Glance

A blog providing analysis of the poultry and feed industries in Latin America.
Broilers & Layers / Avian Influenza

Bachoco: the JBS of the North?

October 31, 2014

The saying goes, every cloud has a silver lining. And such has been the case of Bachoco. Although Mexico's largest poultry company was hit hard by bird flu outbreaks, mainly in breeder farms, the company took this as an opportunity: they produced fertile eggs across the Rio Grande. And the company continues to grow.

Recently, Bachoco announced its results for the third quarter of 2014, with an increase in net sales of 12.5 percent. Additionally, the company also reported net income had jumped from $353.5 million pesos (US$26 million) in the third quarter of 2013 to $1.12 billion pesos (US$83 million) in the same period this year, i.e., an increase of over 300 percent. It is worth noting that the third quarter was always regarded as the weakest in terms of profitability.

Although there are several factors that account for the good performance, such as the downward trend in prices of key raw materials, which allowed for a reduction of the production cost and in turn was reflected in earnings, there is no doubt that Bachoco is doing well, both in Mexico and in the U.S.

But it does not stop there. Although it is openly known that Bachoco — as part of its strategies — is interested in participating in other proteins and in other geographic areas, it has unofficially been heard that Bachoco is going out shopping in Latin America. It is in search of opportunities. And I would not doubt that soon we'll hear news about it. Will Bachoco become the JBS of the North?

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