Report Highlights: 

Post forecasts broiler production to increase by 5 percent in 2015 to 13.3 million metric tons as a result of lower feed costs and higher exports due to the depreciation of the Brazilian currency and new opportunities in the Russian market. The slow growth path in domestic demand is due to the high level of indebtedness of Brazilian consumers, higher inflation rates, and greater competition from other meats, mostly beef.

Executive Summary:

Post forecasts broiler production to increase by 5 percent in 2015. This increase will likely be driven by higher exports stimulated by the depreciation of the Brazilian currency, lower feed costs due to forecast record soybean and corn crops estimated for 2014/15 crop year, and higher world demand for the Brazilian product, especially from the Russian Federation. Post sources also identify the high level of consumer debt in Brazil as a constraint to increased domestic demand. The outlook for turkey production and exports is for moderate growth next year.

Poultry, Meat, Broiler

Production: 

Broiler production is forecast to grow by 5 percent in 2015. FAS Brasilia believes that a production level at nearly 13.3 million metric tons in 2015 reflects the current expectations of producers to continue with a strategy to adjust supply and demand for boilers and to respond to higher world demand for the Brazilian product, especially from the Russia Federation. Producers are likely to benefit from reduced production costs due to higher soybean and corn crops in the 2014-2015 season. The only constraint affecting next year’s forecast is the slowdown in the growth path of domestic consumption due to the high level of indebtedness of Brazilian consumers, higher inflation, and higher competition from beef and pork. 

Post maintained 2014 broiler production and exports estimates from our semiannual reporting. Post believes that current production estimates for 2014 are in line with the additional demand from the Russian market until the end of the year. 

Production Costs 

The cost of broiler production in 2015 is estimated to drop by 5 percent from last year’s level, while producer prices will likely recover around 6 percent during the same period. If this materializes, these prices will contribute to improved profit margins next year. These reference prices are for Parana state, the largest broiler producer in Brazil with a market share of nearly 28 percent of total broiler slaughter. 

Consumption: 

Domestic consumption of broiler meat in 2015 is projected to increase by over 2 percent reflecting a continuing increase in the broiler price (RTC) due to higher expected inflation rates, the high indebtedness of Brazilian consumers, and competition from beef and pork. 

Trade:

Post forecasts broiler exports in 2015 to increase by 11 percent. The growth in exports is likely to be driven by a continued devaluation of the Brazilian currency combined with an additional market opportunity for higher sales to the Russian Federation. According to our trade sources, 38 Brazilian slaughter plants are currently eligible to export broilers to the Russian market. This would allow Brazilian poultry processors to increase their supplies up to 30,000 metric tons per month early in 2015. Brazilian trade sources also forecast higher sales of chicken parts to China in view of a higher number of plants (29) approved for that market. Other promising markets for 2015 are Japan, Egypt, Nigeria, and Mexico. 

Note: The PS&D table excludes chicken feet and paws exports to China and Hong Kong, as per USDA pawns methodology

Production, Supply and Demand Data Statistics:

Poultry, Meat, Broiler Brazil 

 

MY Begin: Jan 2013

MY Begin: Jan 2014

MY Begin: Jan 2015

 

USDA Official

USDA Official

New Post

Inventory (Reference)

53

55

58

Slaughter (Reference)

6,400

6,525

6,725

Beginning Stocks

0

0

0

Production

12,308

12,678

13,312

Total Imports

3

3

3

Total Supply

12,311

12,681

13,315

Total Exports

3,482

3,600

4,024

Human Consumption

8,829

9,081

9,291

Other Use, Losses

0

0

0

Total Dom. Consumption

8,829

9,081

9,291

Total Use

12,311

12,681

13,315

Ending Stocks

0

0

0

Total Distribution

12,311

12,681

13,315

MIL HEAD, 1000 MT, PERCENT, PEOPLE, KG 

Export Trade Matrix

Country: Brazil 

Commodity: Poultry, Meat, Broiler 

Time Period: Jan-Jun 

Units: Metric Tons

Exports for:

2013

2014

Angola

35,166

40,729

China

92,252

106,229

Cuba

16,640

14,151

Egypt

37,672

46,114

European Union

119,030

114,725

Hong Kong

155,775

156,194

Ghana

18,178

8,907

Iran

3,524

5,218

Iraq

50,118

28,266

Japan

198,176

194,218

Jordan

25,949

23,413

Kuwait

61,749

50,644

Oman

32,562

32,110

Phillippines

9,197

16,173

Qatar

32,707

31,094

Russia

20,240

23,024

Saudi Arabia

343,047

318,889

Singapore

35,140

37,467

South Africa

89,842

74,593

South Korea

23,160

29,760

UAE

123,714

124,405

Yemen

38,760

37,603

Venezuela

66,138

116,861

Total for Others

1,628,736

1,630,787

Others not Listed

177,230

187,111

Grand Total

1,805,966

1,817,898

Note: Includes HTS Codes: 0207.11; 0207.12; 0207.13; 0207.14; and 1602.32 

Quantity in Product Weight Equivalent (PWE) 

Updated: August 4, 2014. 


Poultry, Meat, Turkey

Production:

Turkey production is forecast to increase by 5 percent in 2015, mostly driven by a rebound in exports. Lower feed costs due to forecast record soybean and corn crops during the 2014-2015 season are likely to improve producers’ margins. A slowdown in the growth path of domestic demand remains as the main constraint affecting production growth.

Exports 

Turkey exports are projected to increase by 11 percent in 2015, mostly caused by the depreciation of the Brazilian currency. Exports are expected to increase to the European Union, Angola, Peru, the Russian Federation, and Chile, and likely Mexico.

Production, Supply and Demand Data Statistics:

Poultry, Meat, Turkey Brazil 

 

MY Begin: Jan 2013

MY Begin: Jan 2014

MY Begin: Jan 2015

 

USDA Official

USDA Official

New Post

Inventory (Reference)

0

0

0

Slaughter (Reference)

48

49

48

Beginning Stocks

0

0

0

Production

520

535

495

Total Imports

0

0

0

Total Supply

520

535

495

Total Exports

175

180

140

Human Consumption

345

355

355

Other Use, Losses

0

0

0

Total Dom. Consumption

345

355

355

Total Use

520

535

495

Ending Stocks

0

0

0

Total Distribution

520

535

495

MIL HEAD, 1000 MT, PERCENT, PEOPLE, KG 

Export Trade Matrix

Country: Brazil 

Commodity: Poultry, Meat, Turkey 

Time Period: Jan-Jun 

Units: Metric Tons 

Exports for:

2013

2014

Angola

5,639

6,075

Argentina

46

13

Benin

8,327

6,071

Chile

1,356

1,328

Congo

2,306

2,239

Congo, D.R.

648

389

Gabon

385

275

Guinea, E.

1,317

1,906

European Union

36,617

27,600

Hong Kong

288

192

Peru

1,336

2,605

Russian Federation

2,310

1,305

Saudi Arabia

1,109

823

South Africa

9,845

8,339

Switzerland

1,225

1,169

Total for Others

72,754

60,329

Others not Listed

2,470

1,709

Grand Total

75,224

62,038

Note: It includes HTS Codes: 02072400; 02072500; 02072600; 

02072700; 16023100. Quantity in Product Weight Equivalent (PWE) 

Updated: Feb 3, 2014