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LIVESTOCK AND POULTRY
World Markets and Trade
October 1997
Eggs and Egg Products
World production and consumption of eggs and egg products are expected to continue their upward trend into 1998 with China accounting for the largest growth. Although total egg consumption is expected to increase, per capita consumption is expected to remain stable in most countries except China and Brazil. While the United States continues to lead in egg and egg product exports, the U.S. share of the global market is expected to decrease in volume due mainly to increasing Chinese exports.
Production in Selected Countries Continues Its Upward Trend
Image: World Egg Production and Consumption
Total egg production in selected countries is expected to reach 703 billion pieces in 1997, a 2 percent increase from 1996. This growth in production is expected to extend into 1998 with production forecast at nearly 739 billion pieces. While egg production in selected countries continues to increase, the pace of increase has slowed compared to that during the early 1990s. Most of the increase in egg production is expected to occur in China which is expected to produce about 360 billion pieces in 1998, 32 billion above 1997's estimated level, accounting for almost half of world egg production. China's egg production significantly expanded with the removal of export quotas on eggs to Hong Kong in 1996.
Image: China to Dominate World Egg Production in 1998
Minor increases in production are also projected for countries in the western hemisphere and the European Union. Egg production in North America in 1998 is projected to reach 111 billion pieces, up from the estimated 110 billion for 1997. The projected 2-percent increase in U.S. production is expected to more than offset a 2-percent projected decline in Mexico's production. Production increases in Brazil and Colombia are expected to boost egg production in South America, while favorable prices in the European Union (EU) are expected to stabilize egg production at about 83 billion pieces. In other regions, production is expected to remain close to its current level with minor offsetting changes among the various countries.
China Continues to Lead in Egg Consumption
Growth in world egg consumption, including table eggs and egg products, mirrors the growth in egg production. Total world consumption in 1997 is estimated at 626 billion pieces, up 2 percent from 1996. Consumption for 1998 is projected to increase 5 percent reaching 658 billion pieces largely due to a projected 10 percent increase in Chinese consumption which is forecast at 352 billion pieces. Strong economic growth, increased supply and favorable prices have lead to increased consumption of eggs in China. Although leading the world in total egg consumption, China is the world's second largest per capita egg consumer after Japan. While per capita consumption of eggs is expected to fall in Japan and most other countries, China's per capita consumption has steadily increased from under 200 in 1993 to a projected 288 in 1998.
Brazil's per capita consumption is estimated to increase from 82 in 1993 to a projected 108 in 1998. The economic growth resulting from the economic stabilization plan, the Real Plan of 1994, has contributed to increased consumption of eggs and other poultry products. Total 1997 egg consumption in Brazil is expected to reach about 17 billion, up one billion from 1996. Brazil's egg consumption is expected to continue growing with 1998's consumption projected at almost 18 billion pieces.
U.S. egg consumption in 1997 is expected to increase by about a billion reaching 64 billion pieces. The outlook for 1998 indicates an increase of almost 2 billion with total U.S. consumption projected at nearly 66 billion pieces. This includes a slight increase in per capita consumption due to increased consumption of egg products. Egg consumption elsewhere is expected to remain relatively stable.
The United States Dominates World Trade
Image: Increased Chinese Exports Challenge U.S. Market Share
World trade in eggs and products is expected to continue its current upward trend. During 1997, total exports in selected countries are expected to increase 7 percent reaching 6.8 billion pieces while exports for 1998 are projected at 7.5 billion pieces. The United States, China and The Netherlands, together account for about 70 percent of total world (selected countries) exports. The Chinese share of world exports has increased from 8 percent in 1995 to a projected 15 percent for 1998. Increased exports from China have adversely affected exports of U.S. table eggs to Hong Kong which are expected to decline by about half during 1997. China's removal of export quotas on eggs to Hong Kong has significantly impacted Hong Kong's egg market. Chinese eggs are more price competitive and incur substantial transportation cost savings when compared with U.S. egg exports to Hong Kong. In addition, the quality of Chinese eggs has improved vastly as more producers use top American breeds. There have been major investments in China on new egg operations as an increasing number of producers move their operations from Hong Kong into China.
The total value of U.S. egg and product exports increased by over 50 percent during the last 5 years. U.S. egg product exports more than doubled in value from $46 million in 1993 to over $95 million in 1996. However, for the first time since 1988, 1997 U.S. egg exports are expected to decrease in volume due to a large decline in table egg exports to Hong Kong. The outlook for 1998 indicates continued growth in the value of U.S. egg and product exports, supported by increased global demand for egg products.
Image: Value of U.S. Egg and Product Exports Continues to Soar
Japan, Hong Kong, Canada and Mexico together account for over 60 percent of total U.S. egg and product exports. U.S. exports to North America and Japan have steadily increased due to increased demand for egg products. Conversely, exports to Hong Kong have suffered with increased competition from China, and U.S. exports to the Middle East have declined in the absence of the EEP. The United States, however, has been successful in expanding markets in the Caribbean and among the countries of the Former Soviet Union (FSU). Exports to the FSU have risen from below $125,000 in 1992 to nearly $2 million during 1996.
Future Outlook
Image: Major Markets for U.S. Egg Exports
Global production of eggs is expected to continue its upward trend with China leading the expansion. Lower egg prices resulting from the current egg surplus in China is expected to slow down China's rate of expansion in the short run. Although total consumption of eggs and egg products is expected to continue rising, per capita consumption of eggs is projected to stabilize in most countries.
The United States will continue to dominate world trade, spurred by increasing global demand for egg products. However, the U.S. table egg market in the Far East will face increasing competition from China. Despite losing its market share in Hong Kong, the
United States can potentially maintain its global market share with increasing exports of egg products and market expansion in the Caribbean and Eastern Europe.
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