Porto Alegre, September 21, 2023 – June and July was an extremely complicated period for chicken farming. The excessive housing of breeder chicks in May led to unprecedented growth in the volume of chicken meat offered in the domestic market in the following months. August was a month of price recovery, and September a month of consolidation.
The recovery movement was more significant in wholesale and retail, with a great increase among the main cuts (breast, thigh, and wings). Whole frozen chicken also showed excellent recovery. Even in the face of a difficult scenario for competing proteins, especially beef, which went through a very complicated August, chicken remained in a prominent position, considering the preference of part of the population for products that cause a lower impact on average income. Especially for households with income between one and two minimum salaries.
As for demand, there are good expectations of consumption for the last quarter, a period marked by the peak of demand in the domestic market. In exports, Brazil continues to export chicken aggressively, with a monthly average that exceeds 400 thousand tons. The big problem has been the average price for chicken in the international market, even so, the result is commendable.
Production costs are also lower this season, considering the significant decline in corn prices between one year and the next. After the crisis in June and July, the sector managed to improve its margins. It is worth pointing out that there is still a large volume of second-crop corn to be made available in the market, even in the face of an impressive export flow.
As the focus is still on Avian Influenza, Brazil maintains the necessary protective measures to eliminate the disease from its commercial flock. So far the venture has been successful. There are 102 outbreaks of the disease, 100 of which in wild birds and only two in backyard birds. In none of these scenarios does Brazil lose its status as an Influenza-free territory. Maintaining the state of animal health emergency by both states and the Union is important to reduce bureaucracy in the fight against the disease, providing access to resources more quickly.
Brazil’s health status is a huge differentiator; maintaining it this way is essential so that the country does not have to deal with embargoes by our main trading partners, even if temporarily. Following the current flow of shipments, Brazil, for the first time in
history, should surpass the mark of 5 mln tons shipped, consolidating itself as a major exporter of chicken.
The scenario is still highly complex, and even in the face of an improvement in costs and demand, it remains necessary to maintain production under control, avoiding harmful situations of excess supply such as those evident between the months of June and July. This way, the sector will continue to live with a good operating margin.
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