Sharp Jump In Brazilian Poultry

WASHINGTON - Feb 20/07 - SNS -- Poultry production in Brazil wis expected to rise sharply sharply this year, allowing for a major increase in export activity, reports the U.S. agricultural attache for the country.

The increase in broiler production will likely be driven by a rebound in broiler exports and firm domestic demand supported by an economic growth in the range of 4%, lower inflation, a drop in unemployment and higher real income.

Market analysts, however, point out some constraints that could adversely impact on production and trade of Brazilian poultry in 2007. They are: further appreciation of the Brazilian currency relative to the U.S. dollar, which could adversely impact packers' profitability due to the relative increase in production costs, principally because of higher corn and soybean prices.

Although Brazil is free of Avian Influenza, the country is in the path of some migratory birds. As of today, the Ministry of Agriculture has been very slow to implement the official plan to deal with a possible outbreak of Avian Influenza, the so-called Regionalization Plan. The main allegation is the lack of government funds. However, Brazilian poultry packers have moved forwarded and implemented an industry preventive plan against Avian Influenza.

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