Continuing strong demand is predicted for poultry, the nation's favourite meat.
BMI has introduced the new Livestock Outlook in its Peru Agribusiness Report for the third quarter of 2009, according to companies and markets.
Peru's beef production is small by Latin American standards. Domestic production of 163,339 tonnes in 2008 was only around 50 per cent of that in Venezuela and less than a fifth of the amount of beef produced in Colombia. Even Andean neighbour Ecuador, which has a population less than half the size of Peru's and a lower GDP per capita, produces more beef.
Consumption is also tiny by beef-loving Latin American standards. In 2008, per capita beef consumption stood at around 6kg. This compares to 13kg in Colombia, 32kg in Paraguay and almost 70kg in Argentina. Despite these low figures, the beef sector has been growing strongly this decade as Peru's economy has boomed. From 2000 to 2007, beef production rose 25.4 per cent while consumption increased 20.9 per cent. The report predicts growth to slow in 2009 as the economy feels the effect of the world economic slow-down. Beyond this year, however, growth in both consumption and production is expected to continue as Peruvian consumers are able to afford to spend more on food.
Far more significant to the Peruvian diet is chicken. Poultry production has seen rapid growth this decade, expanding by more than 60 per cent from 2000 to 2007. In 2008, consumers were hit by a rapid rise in the price of chicken as producers passed higher feed costs on to consumers and increased demand drove up the price.
With spending on chicken making up 10 per cent of the country's total food expenditure, the price of chicken is closely tracked by the authorities. With the slowdown in GDP growth to a forecast 3.2 per cent this year from 9.8 per cent in 2008, the price of chicken has fallen back since the end of last year. Demand for chicken – the most affordable meat – is likely to remain strong despite the economic troubles faced by the country. Dominating the political agenda in Peru at the end of the second quarter of 2009 was the fatal clashes between police and indigenous protesters in the Amazonian province of Bagua.
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