The measures implemented to cope with the 2012 and 2013 avian influenza (AI) outbreaks in Mexico were sufficient, allowing the poultry sector to rebound to record production levels this year, according to a recent USDA Gains report.
Highly Pathogenic Avian Influenza (HPAI) in the United States and the potential appearance of new AI virus strains in Mexico continues to be a concern for the sector, however. But increased production and affordable prices will keep broiler meat as the consumers' preferred source of protein.
Poultry production in Mexico
Mexican commercial broiler meat production for 2016 is forecast at 3.16 million metric tons (MMT); as the sector continues to grow at 2% annually. Recent data from the National Poultry Association (UNA) indicates that, jointly, the broiler meat and egg production represented a 63.1% share of the total domestic production.
World's largest consumer of eggs
Mexico is the 6th largest egg producing country and has the largest per capita consumption in the world. Mexico is the 6th largest egg producing country and has the largest per capita consumption in the world. Prior to the AI outbreak, per capita consumption of eggs in Mexico during 2011 was 22.4 kilograms (approximately 330 eggs) per person.
During 2012 and 2013, per capita consumption dropped to between 20.8 kg and 21.7 as a result of higher egg prices and scarcer product availability. The recovery started to show in 2014 and per capita consumption was 22.0 kilograms. UNA forecasts that for 2016, per capita consumption will increase marginally from the preliminary 22.2 kilograms expected for 2015.
The country's domestic production of eggs is fully restored to pre AI levels. Despite the occurrence of small AI outbreaks in certain areas, Mexico is producing 108 million boxes (containing 360 eggs) on an annual basis.
Poultry sector looks to diversify
The Mexican poultry sector is now looking to diversify production beyond the two leading producer states, Jalisco and Puebla, to other states that offer natural biosecurity conditions such as less concentration and a larger distance between farms. However, the threat from HPAI occurring in the United States has compelled the sector to implement permanent security and biosecurity measures and to look for alternatives to reduce the risk of contamination.
In addition to limiting supply, the 2012 and 2013 AI outbreaks led to the closure of foreign markets and forced Mexican egg exports down dramatically. As of today, Mexican egg and egg product exports are only permitted if they are breaking eggs, pathogen-free or have received a thermal process. According to UNA, during 2015, eggs for industrial purposes are on the rise and should continue on the same trajectory in 2016.
On the other hand, the current AI outbreak in the United States offers a potential export opportunity for Mexican table eggs. However, the lack of understanding of administrative procedures to export is a significant obstacle for most producers/exporters. UNA has stated that if Mexico is looking for a larger share in the US market, it must look for a country-wide certification to enlarge the number of states or farms eligible to export.
Economic situation and outlook
Although, approximately 98% of Mexico´s chicken and turkey imports originate from the United States, Chile and Brazil continue gaining market share in the poultry trade scenario. In 2013 and 2014, Mexico announced the opening of a tariff rate quota (TRQ) for chicken, turkey, and mechanically deboned meat for all trading partners with whom Mexico does not have an existing free trade agreement, including Brazil.
The full report by the USDA GAIN can be found here.