May 24, 2021
Poultry Producers in Brazil Squeezed by High Corn Prices
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
Poultry producers in southern Brazil are lamenting the fact that corn prices have increased much more than the price of their products. Corn is the main ingredient in poultry rations and over the past 27 months, the price of corn in Brazil has increased 152%, while the prices for live chickens, processed chicken, and eggs have increased 55%.
The domestic corn prices in Brazil are at record high levels due to strong international demand and tight supplies specially in Brazil. Large livestock producers in southern Brazil have been importing corn from Paraguay and Argentina to keep their operations up and running. Corn prices have also been supported by a severe drought that has impacted the safrinha corn production. If the safrinha corn production ends up as bad as feared, the high corn prices in Brazil will be maintained at least through the rest of 2021.
The pandemic shutdowns and social isolation also contributed to the price disparity. The prices from January 2020 to this May increased 22% for live chickens and 15% for processed chickens, compared to a year earlier. At the same time, the price of corn increased 70%.