Monday, December 11, 2023

Rabobank: Trade issues key for poultry outlook

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UTRECHT, the Netherlands — Trade conditions are gradually improving for global poultry thanks to rising global demand — especially from China, which is expected to face a protein shortage this year, notes Rabobank in its latest “RaboResearch Poultry Quarterly” report.

In recent quarters, the global poultry market has gone through one of the most volatile periods in many years, due to a combination of factors, including trade and disease restrictions, along with the impact of the US-Chinese trade war, the report notes. Production was at an exceptionally high level in many markets, including the U.S., the European Union and Thailand. Meanwhile, demand dropped because of a general market slowdown and constraints on access to international markets following trade restrictions. This resulted in a period of falling poultry prices between the second quarter and the fourth quarter of 2018.

“However,” according to Nan-Dirk Mulder, senior animal protein analyst, “the outlook is changing, Rabobank is gradually becoming more optimistic that the market has reached a turning point, with global price levels starting to trend up – especially since global trade conditions have started to improve and have reached a record-high level in Q4 2019. Together with more supply discipline, this has led to improved market conditions.”

The global poultry industry will see trade conditions gradually improve further throughout 2019, with rising global poultry demand — especially from China — as the main positive driver, Rabobank adds.

China is expected to face a protein shortage this year, with poultry as the major substitute. This is due to African swine fever (ASF), which could lead to a 10 percent to 20 percent reduction in Chinese pork production. This would be bullish for both local production and for global trade. But volatility will remain in 2019, driven by changing global trade access. A potential U.S.-Chinese trade agreement that re-opens U.S. chicken exports might shake up trade.

Rabobank added that trade will also be impacted by the ongoing EU-Brazil and Saudi-Brazil trade restrictions, which are impacting breast meat and whole bird prices. Other issues — such as rumors about safeguards being imposed by Mexico on U.S. chicken, or by South Africa on Brazilian chicken — are also wild cards for the outlook. Ukraine and Russia are strengthening their positions in a changing global trade landscape, with the new opening of China for Russian poultry exports a major new factor.

More information about Rabobank and its reports can be obtained at

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