Rabobank: tight supply of poultry meat with increasing demand

Global trade in poultry meat is currently strong due to a tight supply and increasing demand from food service, such as (company) restaurants. Regional crisis situations in developing countries in particular can lead to a sharp decline in chicken consumption. These arise as a result of lower purchasing power due to weaker growth and cost inflation, Rabobank reports.

Prices are high in most regions worldwide as a result of the tight supply, Rabobank states in its quarterly report. As a result of the war in Ukraine, global grain prices have risen 20 to 40 percent.

A challenge for the poultry chain to pass on these high prices to the consumer. ‘That will probably be possible in developed markets with high purchasing power where supply is relatively tight, such as Europe, the United States and Japan,’ explains senior analyst for Animal Proteins Nan-Dirk Mulder of Rabobank.

Trade strong

Global poultry trade is expected to remain strong this year, driven by increasing demand from the food service. “Brazil, China and Turkey will benefit from the current situation in Europe and take over some of the exports from the EU and the war-stricken Ukraine,” Mulder expects. He also believes that despite the sanctions, Russia can selectively take advantage of its competitive position.

THEME UKRAINE: Russia invaded Ukraine on February 24. This war also has consequences for the Dutch agricultural sector. Follow the latest developments around the war in Ukraine.

Global trade will be challenged by continued inflation of transportation costs and disruptions in logistics. Global poultry supply chains need a sharp focus on operations to offset higher costs and delivery challenges. Optimal purchasing, product efficiency and feed formulation are essential in this regard’, says the analyst.

Bird flu pressure decreases

Bird flu remains an important challenge, but pressure should ease in the northern hemisphere in the summer, Mulder said in the quarterly report. From a global perspective, bird flu cases in regions like Europe will disrupt the hatching egg trade. That could affect supply in importing countries, as happened in 2020 and 2021.

Leave a Comment