Brazilian broiler exports for 2014 are now expected to increase by 3 percent, 2 percent lower than the previous estimate by USDA’s Foreign Agricultural Service (FAS) Global Agricultural Informatin Network (GAIN) report. The growth in exports is likely to be driven by depreciation of the Brazilian currency and higher sales of whole broilers and chicken parts to China and Hong Kong, respectively. Trade sources also expect greater broiler exports to the European Union, Egypt, Nigeria, and Iraq. Brazilian exporters are trying to open markets in Myanmar, Pakistan, and Nigeria. Market promotions are concentrated in major world fairs such as Gulfood (Dubai) and Sial (Paris). In addition, specific trade missions are concentrated in strategic markets, such as Japan. Higher tariffs in India and South Africa are a major constraint for exports to these countries, the report noted.
Brazilian broiler production is now expected to increase by 3 percent in 2014, as compared with FAS’ revised downward production level in 2013. FAS Brasilia believes that the production estimate at 12.7 million metric tons in 2014 reflects the current expectations of producers to continue with a strategy to adjust supply and demand for broilers and maintain their profit margins. Producers are likely to benefit from reduced production costs in 2014 assuming estimated record soybean and corn crops combined with higher exports. However, there are some constraints that could affect this year’s broiler production. Those constraints include the uncertainty with the economic outlook and rising inflation, which could slow down the growth path of domestic consumption; the continued high level of indebtedness of Brazilian consumers; higher competition from beef and pork; and the ongoing major dry spell in the center-south that could affect the current soybean and corn crops and provoke power shortages in some producing regions of the country, as well as higher energy costs.
