Brazil regains market share in global poultry trade
The Brazilian meat scandal 'carne fraca' has had a major impact on the poultry exports in the first half of 2017. However, after the wave of temporary import bans, the investigation showed that just 0.5% of Brazil's total processing capacity had been involved in the fraud. Negative impacts on the poultry exports began to fade at the start of the second half of this year, thanks to the considerable effort invested by the Brazilian authorities in providing transparent information to importers.
Brazilian poultry exports in July were around 5% above July 2016, by volume. But during the first seven months of 2017, exports declined by 5% year-over-year.
Analysts at Rabobank expect that the poultry exports will recover during the second half of this year, finishing 2017 slightly above the levels from the previous year. Moreover, "preliminary numbers for the first three weeks of August already indicate a small increase, compared to last year."
But Brazil is not out of the woods yet. According to Rabobank, China announced an anti-dumping investigation into imports of poultry from Brazil. And although the full investigation is expected to take as long as a year, the Chinese authorities could apply a provisional anti-dumping tax after the preliminary analysis in the next two to four months.
Overall, the Rabobank analysts expect the poultry production from Brazil to report a slight increase this year, taking into account that currently there are ongoing low corn and soybean prices which will continue to provide low feed costs and this aspect will support the industry in sustaining positive margins.
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