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Rise in chicken exports in March does not increase margins

Export revenue for Brazilian chicken rose again in March, year on year, after nine months of falls, according to the Brazilian Animal Protein Association (ABPA). But this increase was not enough to improve profitability, according to analysts at BTG Pactual.

Revenue was up by 0.9% in March on the same month in 2015, to US$ 584.3 million, according to the ABPA, from the sale of 403,400 tons, 15.6% up on March 2015.

In the first quarter, revenue was US $ 1.5 billion, down 6.3% year on year. In volume, exports totaled 1 million tons, up by 12% on the first quarter of 2015. The increase in feed costs and the depreciation of the real against the dollar in March had a negative impact on the sector's profitability. Analysts at BTG Pactual say spreads fell by 5% in March and 8% in the first quarter of 2016 compared month on month and quarter on quarter, respectively.

The price of corn, the main input for feed, has increased substantially since the beginning of the year, due to the increased exports of Brazilian grain. Analysts and the market expect the price to fall with the new harvest by the middle of the year. Chicken export revenue in March was the second highest ever, according to vice president of Poultry at the ABPA, Ricardo Santin.

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