While the global poultry industry has undergone several months of slow growth, according to a recent Rabobank report, improved demand and lower costs are expected to come in the fourth quarter of 2023 and in early 2024.
Global poultry market growth in 2023 will likely only improve by 1.2 percent — well below the 2.5 percent historical average per year — but Rabobank said the market will still be well positioned for the new year.
“After a period of slow poultry consumption growth due to a weak global economy and rising prices resulting from cost increases, global demand has room for some recovery,” said Nan-Dirk Mulder, senior analyst of animal protein at Rabobank. “This is driven mainly by lower feed costs and, therefore, lower chicken prices. Poultry should be able to benefit from its relatively competitive pricing in many markets compared to other proteins like beef, pork and alternative proteins.”
Avian influenza (AI) continues to play a role in market conditions as well. Next to South America, Japan has had sustained the most significant impact from the disease, culling nearly 10 percent of its layers. The most recent outbreaks in Europe and North America have mainly been in wild birds.
“As AI is now present in most regions, new outbreaks will occur frequently, which often means temporary restrictions on global trade and shifts in trade flows,” Mulder said.
He advised producers to focus on the operational side. Corn prices have dropped significantly since August due to a larger-than-expected harvest, and wheat prices have gone down as well.
“Although we believe feed prices will drop slightly, operational costs are still at historic highs, and risks of further volatility exist in grain prices, due to El Niño, and in energy prices and availability,” he said. “Ongoing leadership in terms of costs and procurement will remain key.”
