Brazil’s chicken meat production outlook for 2020 calls for an increase of 2.5 percent, mostly due to rising global demand for chicken meat, especially from China and higher domestic demand as the Brazilian economy is expected to rebound next year with a projected GDP growth of 2 percent, lower inflation and declining unemployment rates. In addition, feed prices are expected to be stable next year due to a bumper corn and oilseed crop. The price of chicken meat in the domestic market is expected to capture market share from beef and pork, according to USDA’s Foreign Agricultural Service latest GAIN report.
Chicken meat production in 2020 is forecast at 13.975 million metric tons, mostly driven by rising global demand, especially from China and higher domestic demand. Trade sources remain optimistic that exports to China will remain firm next year due to the outbreak of African Swine Fever (AFS) in Asia.
Domestic demand for chicken meat is also forecast to increase due to the expected rebound of the Brazilian economy in 2020, projected lower inflation, and declining unemployment rates. Other factors contributing to the optimistic outlook next year include: feed costs are likely to remain stable due to a projected record 2019/2020 soybean and corn harvests; an above average number of chicks placed in meat-growing operations in the past months, reflecting producers’ confidence in the market; and the average live weight of birds continues to grow due to improved genetics, and the competitive prices of Brazilian product.
The average cost of production for chicken meat during the first half of 2019 increased by 1.82 percent compared to the same period in 2018. Corn and soybean meal accounted for 68 percent of the total cost of production. The outlook for 2020 calls for a continued stability in feed costs due to projected bumper corn and oilseed crops during 2019/2020.
