Source: Lisa M. Keefe, MEATINGPLACE, 12/8/16


The outlook for the global poultry industry in 2017 has been generally positive, but is now being challenged by a new wave of avian influenza (AI) outbreaks, an unwelcome development as the global market was just recovering from the negative impact of the 2015 AI crisis, Rabobank said in a release about its quarterly poultry outlook report for the fourth quarter of 2016.

New outbreaks in recent weeks have the potential to shake up global market conditions in 2017 in both meat trade and breeding stock trade, the Rabobank report noted.

This development comes at the same time the industry has started reporting better results and favorable fundamentals. The industry has strong market balances in most regions and ongoing low costs, despite pressure from declining red meat prices.

The 2016 return of bird flu is shaking up global trade conditions and is especially affecting the outlook for Asia, Europe and Africa. It also will be a test for the U.S. industry, after last year’s multiple AI outbreaks. Because many European and Asian countries are exporters of meat and breeding stock, this will certainly impact the outlook for the industry and could shake up meat and breeder trade again, Rabobank said.

Meanwhile, the ongoing Chinese poultry supply shortage will continue to affect global market conditions. Imports to China and Hong Kong are expected to remain high, benefiting countries that are allowed to export directly to China, while Chinese consumers will continue to face high prices for specific preferred products, such as feet and wings. The industry is working on new strategic sourcing initiatives to alleviate some of this supply pressure.

Global trade volumes, however, are expected to remain under pressure next year, given the resurgence of AI and increasing trade protectionism, Rabobank predicted. China’s import demand and the possibility of improved relations between the U.S. and Russia are promising, but lower support for TTIP and TPP will have adverse impacts.

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