Rabobank highlights increased chicken consumption as key driver of global poultry recovery

08 Jul 2024 --- Rabobank’s latest animal protein report flags global poultry markets as resilient and rebounding amid tough trade conditions. The analysis highlights an “improved outlook,” partly due to accelerated growth in poultry consumption, which is edging up by 1.5% to 2% and expected to increase further.

Global poultry markets have faced highly disruptive conditions for around four years, including the COVID-19 pandemic, supply chain disruptions and fluctuating feed prices. However, markets are already showing signs of normalizing.

Declining feed prices have made chicken more affordable and there are strong local trade conditions in emerging markets like Southeast and South Asian, Africa and Latin America, while the EU and US are performing well.

“Despite a 2% increase in global chicken prices, chicken remains a competitively priced protein option as prices of pork and beef have increased by 4% and 5%, respectively,” notes the report.

“Global poultry markets continue to exhibit strength, with expected growth ranging between 1.5% and 2%, which is close to historical levels. We expect most markets to remain relatively balanced.”

However, many challenges remain in the global market, including the ongoing spread of avian influenza (cases are now shifting toward more Southern Hemisphere countries), volatility risks and extreme weather due to La Niña and the EU Deforestation Regulation.

Snapshot of markets
The Global Poultry Quarterly Q3 2024 analysis cites good poultry demand from retail, foodservice and processing segments in the US, but export demand remains “soft” due to the strong dollar and high local prices of dark meat. Productivity issues are also expected to limit supply growth.

Rabobank analysts expect an “improved outlook” for poultry producers as consumer demand grows.The Rabobank report highlights that demand is strong in Europe, but supply growth is slower due to lower placements and fewer Ukrainian imports. Prices remain under pressure due to oversupply in China. Imports declined in the first four months of 2024 but are forecast to pick up. Local production is also “starting to self-correct.”

There is more oversupply in Japan and strong demand in Thailand, where exports are at a record high. Exports are also strong in Brazil, where feed prices have started to increase.

Improving market conditions
As a result of improved market conditions, more regions worldwide are now producing at above-breakeven levels, says Rabobank. “The EU, South Africa, Russia, Mexico and Colombia have been performing well for some time and this year has seen significant improvements in market conditions for the US, Brazil, Thailand, Indonesia and the Philippines.”

An expanding middle class with greater spending power is also seeking high-protein food in India, which is also performing well, according to the report. 

By Gaynor Selby