World Broiler Meat Production Expected Virtually Unchanged From 2008
Oversupply, falling prices, and shrinking imports due to the global economic slowdown, are expected to cause production to stagnate in 2009. Over the previous 3 years production had expanded by 13 percent. Production in the United States, Brazil and China accounts for 55 percent of world output. Faced with large supplies and falling prices the Brazilian broiler industry is expected to drastically lower their rate of growth although production is still forecast to expand by 3 percent over last year. US production is expected to decline due to rapid increases in feed and energy costs. Over the longer term, continued adverse economic conditions coupled with lower prices and reduced domestic consumption are expected to dampen expansion. China’s production growth is expected to slow down as the industry is experiencing losses due to avian influenza outbreaks, causing slaughterhouses to close. Russian and Ukrainian production continues to expand, aided by government subsidized credits and import restricting policies.
Global Consumption Forecast Up Slightly – But Below Past Growth Rates
Higher production in the EU and Brazil will support expanding consumption in those countries. For the EU, despite rising domestic poultry prices, consumption continues to grow. US consumption is expected to decline due to the unsettled economic conditions as incomes are reduced. Chinese consumption growth is expected to slow as consumers shift to pork, their more favored meat, and unemployment rates of migrant workers rise; a major segment of the population that consumes poultry.
Global Imports are Expected to Ease Slightly
Imports are now forecast to decline slightly in 2009, after imports had surged nearly 30 percent over the 3 previous years. Imports are expected to be constrained by restrictive import policies, high tariffs and weaker currencies in Russia and Ukraine, and oversupply in the case of Japan. Alternatively, Chinese, Mexican, and EU imports are revised upwards as more broiler meat is expected to be consumed in these markets.
World Exports Decline
Lower exports from Brazil, the United States and the EU, which together account for 90 percent of global trade, reflects restrictive Russian import policies and intensified competition. Despite falling prices, Brazilian exports are estimated to have much slower growth as exports are forecast only slightly higher than in 2008, largely due to reduced imports by Japan. EU exports face more competition from lower-cost countries like Brazil and the United States. Declining U.S. exports reflect tighter domestic supplies and overstocked markets, among other factors.