August 21, 2014

 

Brazil's chicken meat exports to rise above four million tonnes in 2015

 

 

Russia's trade sanctions on specific nations has benefitted Brazil's broiler meat exports which are expected to see volumes rising above four million tonnes in 2015.

 

The figure represents a jump of 11.8% on record volumes of 3.60 million tonnes expected for 2014, according to a USDA bureau based in Brasilia. Thus, Brazil's position as top exporter is strengthened when it previously seems to be weakening. The South American state is still leading above second-ranked US with a gap of below 200,000 tonnes this year.

 

The prospect of a jump in exports is being underpinned in part by a weak Brazilian currency, and lower feed costs which are supporting chicken producers' margins.

 

However, the bureau also added that "higher world demand for Brazilian product, especially from the Russian Federation", which has turned to the South American country for supplies after imposing bans on food products from the likes of the EU and the US, which have censured Moscow over its role in the Ukraine crisis.

 

The bureau, highlighting "additional market opportunity for higher sales to the Russian Federation", said that, according to sources, 38 Brazilian slaughter plans were eligible to export broiler meat to Russia.

 

"This would allow Brazilian poultry processors to increase their supplies up to 30,000 tonnes per month early in 2015," the bureau said in a report.

 

This implies a potential for exports to Russia above the 60,000 tonnes shipped in 2013, with an additional 150,000 tonnes outlined by Abpa, the Brazilian meat industry association. The development places Russia as a top export market for Brazilian chicken, behind the likes of Saudi Arabica, to which volumes in the first half of the year reached 319,000 tonnes, and Japan, at 194,000 tonnes.

 

Brazil has previously exported 300,000 tonnes of chicken in a year to Russia, according to Abpa.

 

The additional exports would be supported by Brazilian broiler meat production which has witnessed an increase of 5.0%, at a record 13.3 million tonnes in 2015.

 

Brazil ranks third in world broiler meat production, behind the US and China, although output in the latter has been badly affected by bird flu fears, and is seen falling this year by 650,000 tonnes to 12.7 million tonnes.

 

Brazilian producers "are likely to benefit from reduced production costs due to higher soybean and corn crops in the 2014-15 season", the USDA bureau said.

"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."

 

The comments follow an estimate by JBS, the world's biggest meatpacker, that Russia's turning away of meat imports from the likes of Australia and the US would lift sales for JBS' South American operations by US$600 million - US$800 million.