Poultry outlook challenging but set to recover

19-12-2018 | | |
Photo: Dick van Doorn
Photo: Dick van Doorn

Ongoing global trade disputes with exporters competing for reduced volumes is likely to lead to a challenging start for the global poultry industry in the first half of next year.

The latest quarterly review from Dutch-based Rabobank says US-China tensions, the changing trade standards in Saudi Arabia and the removal of some Brazilian exporters from the EU approved list will mean trade will remain competitive and volatile for the time being.

Ongoing avian influenza outbreaks and other diseases, such as Newcastle Disease, will add to the challenges facing the sector, resulting in an impact on global trade flows and prices.

In its synopsis, Rabobank argues that it is important to keep markets balanced: “Under such very volatile conditions, being restrictive in supply to keep markets balanced is key, and regions involved in trade, like the US, the EU and Thailand, should follow the successful steps taken in Brazil, South Africa and Russia.”

Rabobank is however optimistic that the sector will recover and have an enhanced second half of the year.

The report is more downbeat that the recent US Department of Agriculture (USDA) prognoses for global poultry trade, which suggested a 2% increase in global production in 2019 to a record 97.8m tons.

The USDA periodic report, which was released in late October, said there were positive conditions for global poultry production, citing continuing low feed prices, the absence of major bird flu outbreaks in regions with the highest poultry production and constantly growing demand for poultry meat.

Global trade in 2019, it said, was expected to reach 11.6m tons and Brazil – despite its recent contractions – will remain the leader in world poultry exports at around 3.7m tons.

The USDA study predicted that the European Union – the third largest producer and exporter in the world – would see production rise by 1% in 2019, while exports could grow by as much as 5%.

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Tony Mcdougal Freelance Journalist