Global poultry markets recover as challenges ease – Rabobank

According to the latest Rabobank Poultry Quarterly report, the global poultry meat market is expected to grow at a slow pace of just 1% in 2023.

Nevertheless, global poultry meat markets are well positioned for a gradual improvement in the fourth quarter of 2023 and early 2024, although the level will depend on how balanced they are. After a period of slow growth in poultry consumption due to a weak global economy and higher prices as a result of rising costs, global demand has room for some recovery, mainly due to lower feed costs and hence lower chicken prices. Markets will remain largely price-driven, but poultry should be able to benefit from its relatively competitive prices in many markets compared to other proteins such as beef, pork and alternative proteins.

Rabobank says it sees improving market conditions in the US, Mexico, Japan, South Africa, Indonesia and China. However, the situation in Indonesia and China will be fragile. The EU market has been strong, but high levels of fresh chicken imports are creating pressure. Brazil and Thailand are facing more challenging conditions and will need to better control supply growth in oversaturated domestic markets.

Global trade is expected to remain strong in the second half of 2023 after reaching a record 7.2 million tons in the first half of the year, driven entirely by increased trade in raw poultry meat, while trade in processed poultry meat fell sharply. Consumers’ product preferences are changing amid rising prices in the markets and this trend is expected to continue in the second half of 2023 and into 2024. Brazil is expected to benefit the most as the cost leader in raw chicken meat, while Thailand and China need to refocus on raw chicken trade, which will challenge the price position of these exporters.

Government interventions driven by food security, geopolitics and sustainability will continue to impact markets and create instability in global trade. Avian influenza will remain an important factor that could suddenly impact global markets, both in terms of local supply and trade, especially if the southern states of Brazil are affected.

Producers should continue to focus on the operational side. Although feed prices will come down slightly, operating costs are still at historic highs and there are risks of further volatility in grain prices (due to El Niño) and energy prices and availability. Continued leadership in terms of costs and procurement will remain key.

Tags: chicken