October 28, 2005

USDA: Brazil dairy and products annual 2005

Market analysts project economic growth to continue in 2006 around 4 percent, reflecting the results of strong measures in fiscal and monetary policies to curb inflation rates and the public deficit.

Spurred by record exports, most sectors of the Brazilian economy increased their capacity utilization to meet a growing world demand for Brazilian goods. Lower unemployment rates and increased disposable income maintains domestic demand at good levels.

The dairy sector is expected to benefit from these improved economic conditions. Total fluid milk production is forecast to increase by 4 percent in 2006, and most dairy products will show a similar increase in production boosted by higher purchasing power and lower unemployment rates.

Despite the current valuation of the Brazilian currency, traders expect Brazil to continue expanding dairy product exports in 2006.

For the full USDA report, click here.