Poultry prices on growth curve

By Oli Haenlein contact

- Last updated on GMT

Global poultry prices are taking off, according to Rabobank
Global poultry prices are taking off, according to Rabobank

Related tags: Influenza, Supply and demand, Poultry

Global poultry prices are taking off, leading to improved profitability for the global poultry industry, according to Rabobank.

The rise in prices in the second quarter of the year is due to relative support from high beef and pork prices, as well as demand recovery and a more balanced supply and demand situation in most regions around the globe.

Rabobank analyst Nan-Dirk Mulder said: “Under improved global market conditions, led by the North American region, a slight increase in global chicken prices is expected. We see an increasingly balanced market, where supply discipline is more the order of the day and improving margins will be the likely result.”

Global feed prices are expected to decline in the third and fourth quarters of the year, due to a good crop outlook for wheat and soybeans. However, volatility in feed prices is a threat, with global grains and oilseed prices recently increasing. The situation in Ukraine remains a concern, as is the potential threat of El Niño.

Mulder added: “Markets remain volatile and any change in fundamentals, especially from the supply and feed side, will impact global prices. Suppliers should look to keep production growth disciplined”.

In the US, 2014 is looking like it will be one of the most profitable years in the last decade, due to lower beef and pork production, among other reasons. There are strong margins and well balanced markets in the EU, as there is good demand and reduced production.

In China the industry is recovering from the negative impact of avian influenza outbreaks, and both retail and live bird prices are increasing. Prices are expected to hold firm in Brazil, due to high prices of competing proteins, and increases in domestic and international demand.

In Russia, the poultry industry is still suffering from oversupply, while production in Mexico has not been able to recover from its 2013 contraction. It could suffer further due to the return of avian influenza.

Related topics: Meat

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