The outlook for global poultry trade looks turbulent
The poultry industry has begun the year with great expectations as the reasonable price levels and margins and a fewer avian influenza (AI) outbreaks were registered in 2018 compared with last year.
Still, the outlook on global poultry trade has changed rapidly in the first quarter of this year and the industry can prepare itself for the biggest shake-up in many years, according to a Rabobank report.
"In the coming months, the global poultry market is set to go through turbulent times, especially due to ongoing restrictions because of AI, the weak-flesh investigation in Brazil, and recent temporary restrictions on exports to the EU for one of Brazil’s leading exporters, as well as the pending ban on stunning for exported products into Saudi Arabia", says Nan-Dirk Mulder, Senior Analyst – Animal Protein at Rabobank.
Other potential obstacles include the anti-dumping investigation into Brazilian imports by Chinese authorities, and NAFTA renegotiations, which could potentially shake up North American poultry trade later this year, mentions the report.
Brazil is in danger to lose an important market share in Saudi Arabia and Europe while Russia, Poland or Ukraine could partially fill that void but without covering at the full extent the Brazilian poultry exports to these areas.
EU trade restrictions will affect breast-meat prices while the Saudi Arabia standards will influence the whole-bird market, believe the analysts. Along with those stand the China/Brazil dispute and NAFTA renegotiations, events that could have a significant impact on the dark meat market.
Russia and Thailand, producers who are now confronted with oversupply after industry expansion, will try to capture some of Brazil’s lost market share in global trade. At the same time, regional industries like the ones in Mexico, South Africa or Europe will develop further encouraged by an increase in prices for the poultry products delivered on the domestic markets.
Meantime AI pressure is considered to be significant, but not at the same levels registered in 2016/2017. China has shown the most remarkable recovery, with one of the most profitable winter seasons in years for the industry, thanks to AI vaccination, which has helped to significantly reduce the number of cases in the country, shows the Rabobank report.
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