Frozen chicken price drops for third month, reaching a 2025 low amid shifting market dynamics

The average price of frozen chicken has experienced its third consecutive monthly decline, falling to its lowest point since the first half of 2025. This persistent downtrend reflects a complex interplay of robust export activities and a significant weakening of domestic consumer demand, impacting poultry producers nationwide. The latest figures, released on Friday, December 6, 2025, highlight the ongoing pressures on the sector as the year concludes.

Consumers in Greater São Paulo are now finding whole frozen chicken at an average price of R$ 7.36 per kilogram, marking a 4.5% reduction compared to November 2025’s average. This continued depreciation follows similar drops in October and November, signaling a sustained softening in market values across various poultry products. The trend extends beyond frozen chicken, indicating a broader market adjustment within the entire poultry industry.

This downturn brings market values back to levels not seen since the challenges of early 2025. During June of that year, the average kilogram of chicken was traded at R$ 7.47, a period marked by increased outbreaks of avian influenza in commercial Brazilian farms, which had significantly disrupted supply chains and market stability. The current decline, however, stems from different market forces.

Market downturn intensifies poultry product devaluation

The observed devaluation has not been isolated to a single product category; instead, it has permeated nearly all segments of the poultry market. This widespread impact underscores the systemic nature of the current economic pressures facing producers and distributors. The consistency of price reductions across diverse poultry items suggests underlying factors are influencing the entire supply chain.

This broad market adjustment is causing significant concern among poultry farmers, who are grappling with the dual challenge of falling prices and persistent operational costs. The cumulative effect of these monthly declines could strain profit margins and investment capacities for many agricultural businesses, particularly smaller operations.

Avian flu recovery and market surplus

The market’s current trajectory stands in contrast to the volatility experienced in the first half of 2025, when avian flu cases prompted sharp price fluctuations and supply concerns. Following successful containment and recovery efforts, production capacities have largely rebounded, contributing to a more robust supply of poultry products now. This recovery, while positive for food security, has inadvertently led to increased availability.

The period immediately following the avian flu outbreaks saw prices temporarily spike due to reduced supply and heightened demand for available stock. However, as farms recovered and resumed full operations, the market began to stabilize, eventually leading to a surplus that producers are now navigating. This oversupply, coupled with other economic factors, is a key driver of the current price depreciation.

Strong export performance vs. weakening domestic demand

Despite the domestic price slump, Brazil’s poultry export sector has maintained a remarkably strong performance throughout the year, with December 2025 marking yet another period of vigorous overseas shipments. Export volumes for both chicken and pork reached record highs during this period, demonstrating the nation’s crucial role in global protein markets and providing a vital outlet for excess production.

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However, this robust export activity has not been enough to offset the pronounced decline in domestic demand. Researchers point out that while exports absorbed a significant portion of the increased production, the diminishing purchasing power of the local population has severely intensified the downward pressure on prices within Brazil. This imbalance between strong external demand and weak internal consumption is central to the current market dilemma facing the industry.

The disparity creates a challenging environment for producers. While export markets offer some relief, the foundational strength of the domestic market remains critical for sustained profitability and stability. The reliance on foreign demand, while beneficial, also exposes producers to global economic fluctuations, adding another layer of complexity to their operational strategies.

Consumer spending habits shift during end-of-year

Historically, the late December period and the transition into early 2026 are often characterized by a noticeable dip in internal consumer demand. This seasonal pattern is largely attributed to a combination of factors that collectively reduce household purchasing power. As families face increased expenses related to holidays, school preparations, and other year-end obligations, discretionary spending on certain food items, including frozen chicken, typically decreases.

This year, the trend appears to be exacerbated by broader economic conditions that have already strained household budgets throughout 2025. Consumers are becoming more price-sensitive and selective in their food purchases, often opting for more affordable protein sources or reducing overall consumption. The cumulative effect of these spending shifts plays a significant role in the persistent price drops observed in the poultry market.

Broader economic outlook for the agricultural sector in 2026

The performance of the agricultural sector has been a significant driver for the national economy in 2025, contributing substantially to the Gross Domestic Product (GDP). This strong showing was buoyed by favorable weather conditions, increased productivity, and robust commodity prices earlier in the year. However, analysts are projecting a more subdued outlook for agriculture in 2026, suggesting that the sector may lose some of its momentum. Factors such as fluctuating global demand, potential shifts in trade policies, and persistent domestic economic challenges could temper growth expectations. For the poultry industry, specifically, this broader economic forecast implies continued pressure to adapt to evolving market conditions, making strategic planning for the coming year critical for sustained profitability and stability.

Regional impacts and producer concerns

Across various agricultural regions, specific sectors are grappling with unique challenges that reflect broader market complexities. For instance, rice producers in the state of Rio Grande do Sul have already initiated calls for proactive government measures to mitigate an impending crisis in their industry. Such regional pleas highlight how diverse segments of the agricultural economy are facing distinct pressures, from market price volatility to adverse climatic events, demanding tailored interventions and support systems.