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Korean Broiler Production Expected to Increase 10.5 Percent in 2012 - Washington Report

Korean broiler production is projected to be at 686,000 metric tons in 2011 and 720,000 tons in 2012, a 10.5-percent increase, according to USDA’s Agricultural Marketing Service’s “International Egg and Poultry Review” issued this week. Despite outbreaks of highly pathogenic avian influenza (HPAI), high feed costs, and high farm gate prices for live broilers, the forecast for broiler meat production in Korea was revised higher from the previous outlook. Between December 2010 and May 2011 Korea culled about one million birds because of HPAI, comprising about one percent of Korea’s broiler industry.

Broiler meat consumption is forecast at 775,000 tons in 2011 and a record 798,000 tons in 2012, a 3.0-percent increase.  Consumption of broiler meat is expected to increase more than originally forecast because of a shortage of domestic pork resulting from outbreaks of foot and mouth disease; competitive pricing for chicken in comparison to other meats; an increase in more health-conscious consumers; and fears of radiation contamination surrounding fish after Japan’s March 2011 earthquake, tsunami, and nuclear meltdown. Recurring HPAI outbreaks have had little impact on broiler meat consumption, as a result of successful education and marketing campaigns. New country-of-origin labeling at fast-food restaurants has improved demand for domestic meats. In 2011, 35 percent of total chicken consumption was comprised of cuts with the remainder in whole bird form. This increased preference for chicken cuts is expected to continue.

From January-June 2011, Korea imported 46 percent more chicken.   The first-half total was 73,381 metric tons with 49,958 tons or 68 percent from the United States.  Imports were up because of limited pork supplies and the implementation of a 50,000 ton zero-duty tariff rate quota (TRQ)  for chicken May 2011 through December 31, 2011.  However, imports will likely slow down in the second half of 2011 and estimated have been reduced to 100,000 tons for 2011.

Korea is predicted to import 10 percent less chicken meat in 2012 (90,000 tons), as a result of increased local production. The United States is expected to export 62,000 tons in 2011 and 55,000 tons in 2012 to Korea.  Korea’s primary chicken meat suppliers are the United States (leg quarters), Brazil (wings and breast meat), Thailand (heat-treated and processed product), China (heat-treated and processed product), and Denmark (wings). However, imports from Denmark could increase as a result of its slight price advantage (18.5 percent duty) after the recent free trade agreement between Korea and the European Union was implemented July 2011.