Brazilian companies linked to the chicken supply chain, the country’s second largest agribusiness sector and world leader in sales of the product, are expected to reduce their activities in consequence of the advance of bird flu, which has caused sales to drop, especially in Europe.
According to the executive director of the Brazilian Poultry Union (UBA), Clóvis Puperi, the problem may be bypassed by the second half of the year.
Puperi informed that the worsening of market conditions prompted the organization to amplify a recommendation made to its 400 members in February to reduce the number of fowls in the enclosures where the birds are bred.
In February the recommendation was for a 5-10% reduction. The current recommendation is for a 15-20% reduction. This would reduce the monthly breeding population from 365 million to 300 million.
Regarding the impact of this change on employment in the sector, Puperi said that each company will have to judge its own ability to maintain its workforce intact.
"Each company is attempting to adjust the best way possible, and some have already granted collective holidays," he observed.
He defended the need to trim supply in order to avert the risk that domestic prices will plummet, which would inflict serious losses on the sector.
He added that, "since no case [of bird flu] has been registered in Brazil and we don’t have the problem of migratory fowl, our position is one of caution and prevention."
Data from the Brazilian Association of Chicken Producers and Exporters (ABEF) indicate that exports in February were down 7.8% in comparison with February, 2005. Total shipments, amounting to 198,887 tons, were also 7% lower than in January of this year.
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