Highlights

Chilean exports of beef and beef products increased 106% in volume on CY2015 due to a favorable exchange rate, improvements in its traceability program that facilitated access to the U.S, Canada and Central America, and the opening of the Chinese market for Chilean beef on mid-2015. In CY2015, Chilean beef production fell 3.2% compared to CY2014, while imports increased 2% in volume, with Paraguay as the main beef supplier for Chile. In CY2015 Broiler production increased 5.6% over 2014, while imports increased by 22% and exports by 14% in volume.

Beef Production:

Chile's domestic beef production in CY2015 totaled 216,860 MT carcass weight equivalent (CWE), a 3.2% reduction over CY2014.

The production decline occurred between September-November and was due to a decline in availability of bull calves for slaughter. In addition, the bull calves decline was a result of the intense drought in the 10th region of Chile during this period, as well as the beginning of 2015. Because of this drought, dairy production was also affected and milk prices have been low for dairy producers, which resulted in an increase on cow slaughter. Beef production by type of animal calf indicates that slaughter fell in CY2015, while cow slaughter increased.

Beef Trade:

Chile's beef imports come mainly from Mercosur countries (Argentina, Brazil, Paraguay and Uruguay). In CY2015 beef exports prices from Mercosur countries were 8% lower than 2014, Paraguay had the lowest price from these countries and the highest reduction in price (11%). This price reduction has to do mainly with lower prices paid by Russia (major beef destination from Mercosur), Chile and Brazil.

Paraguay was the main supplier of beef, but had an outbreak of “food and mouth disease" on “2011" which lowered its participation on Chilean Market; Paraguay has been recovering since then and has regained its position as the main beef supplier for Chile. Brazilian beef exports to Chile have been favored by a high depreciation of their currency (Reais). In January 2016, Chilean total imports of beef were 11.5% higher over January 2015, which breakdowns to 32.2 % increase from Paraguay, 4.7% increase from Brazil and a 5.1% increase from Argentina (based on ODEPA 2016 statistics).

In CY2016 Paraguay is expected to continue gaining market share in the short term, because they have the lowest prices in the market. However, Argentina is expected to increase beef exports to Chile and will gradually regain market share since all of exports tariffs were eliminated by new elected president Mauricio Macri.

In CY2014 Chilean exports of beef and beef products totaled 5,555 MT CWE and surged to 11,451 MT CWE on CY2015 which is a 106% increase in volume.

Three main factors caused the increase Chilean exports during CY2015: first, a favorable exchange rate (the Chilean peso depreciated in relation to U.S. dollar which favors exports); second, the traceability program was updated which facilitated access of Chilean beef/beef products to the U.S, Canada and Central America; and the third is that the Chinese market was opened for Chilean beef in mid-2015. Chilean exporters expect to continue to maintain exports in 2016 considering that these conditions are expected to stay similar throughout the year.

Meat, Beef and Veal

2014

2015

2016

Market Begin Year

Jan 2014

Jan 2015

Jan 2016

Chile

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Slaughter (Reference)

0

0

0

0

0

0

Beginning Stocks

0

0

0

0

0

0

Production

224

224

228

217

232

224

Total Imports

241

207

200

212

230

215

Total Supply

465

431

428

429

462

439

Total Exports

6

6

10

11

12

12

Human Dom. Consumption

459

425

418

418

450

427

Other Use, Losses

0

0

0

0

0

0

Total Dom. Consumption

459

425

418

418

450

427

Ending Stocks

0

0

0

0

0

0

Total Distribution

465

431

428

429

462

439

(1000 HEAD) ,(1000 MT CWE)

Broiler Meat Production:

Chilean production of broiler meat in CY 2015 was 599,000 MT, which was a 5.6% increase over 2014. Broiler production October through December 2015 was at its highest level reaching near 54,000 MT monthly. Production has been growing constantly because of low broiler prices compared to beef and the lower prices of grains and feed products used in the industry. Demand of poultry products has been consistently growing.

Broiler Meat Trade:

Depreciation of the Chilean Peso related to dollar was favorable for Chilean exports. In 2016 the US Dollar is expected to remain strong thus benefiting Chilean exports. Main destinations of Chilean exports were Mexico, United States and China. Chinese market is expected to keep demanding broiler meat from Chile, despite deceleration of their economy.

Broiler meat exports in CY2015 increased 22% in volume over 2014. The main destinations were China, Mexico and the United States. Chilean Exports to China increased 88% in value and 55% in volume. On 2016 exports to China should continue to increase. Exports to the U.S. had a big increase also, attributed mainly to market attractiveness by high exchange rate (US dollar related to Chilean peso). Exports to Mexico had a more moderate increase in 2015.

In contrast, Chile too imports broilers. The main exporters of broiler meat to Chile are the United States and Brazil. Export volumes from both countries increased in CY2015. Brazil is expected to remain the top supplier since Brazilian Real is depreciated and we should expect a similar increase in imports throughout 2016.

Poultry, Meat, Broiler

2014

2015

2016

Market Begin Year

Jan 2014

Jan 2015

Jan 2016

Chile

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Inventory (Reference)

0

0

0

0

0

0

Slaughter (Reference)

0

0

0

0

0

0

Beginning Stocks

0

0

0

0

0

0

Production

567

567

580

599

585

605

Total Imports

87

87

110

106

125

120

Total Supply

654

654

690

705

710

725

Total Exports

87

87

95

99

100

110

Human Consumption

567

567

595

606

610

615

Other Use, Losses

0

0

0

0

0

0

Total Dom. Consumption

567

567

595

606

610

615

Total Use

654

654

690

705

710

725

Ending Stocks

0

0

0

0

0

0

Total Distribution

654

654

690

705

710

725

(MIL HEAD) ,(1000 MT)