Poultry Meat and Eggs
A resurgence in import demand for poultry meat, particularly in Asia, has helped to stem the decline in product prices while supplies have remained plentiful. The major producing countries continue to expand production in light of relatively low input prices. Attractive retail prices for poultry meat have also helped to spur consumption domestically. International trade in eggs and egg products is expanding again, but at a slower pace.
Poultry meat production for the countries covered in this report is forecast to continue to expand, up almost 4 percent in 2000, following growth of 4.5 percent last year. Brazil and China production forecasts are up the most since our last circular, and Thai poultry production is also stronger than earlier estimated for 1999 and 2000. The U.S. production forecast for 2000 has been reduced slightly from our last circular as both broiler and turkey producers are not expanding as fast as anticipated in the face of continued low product prices. Poultry consumption world-wide continues to grow in line with the increases in production.
Poultry meat imports were up 13 percent in 1999 as the economies of major importing countries recovered. Imports are forecast up another 4 percent in 2000 based on continued strong demand, especially in Asia. Revised Chinese data indicated significantly stronger broiler imports than in our last report. In addition, Russian poultry imports were revised upwards based on exporter data and estimates on transshipments. U.S. poultry exports are forecast up 2 percent after dropping to 2.5 million tons in 1999. Brazil is also expected to show robust export strength in 2000.
The United States, the worlds largest poultry producer, is expected to increase poultry meat production by 4 percent in 2000, slightly below the 5.6 percent production growth seen in 1999. Domestic consumption growth continues to support the production expansion, but exports are also expected to pick up in 2000, particularly to the Asian markets.
Brazils broiler meat production increased by nearly 15 percent in 1999 in response to strengthened domestic demand and record exports. Producer returns were reduced in the last half of the year as feed prices started to rise, but broiler production for 2000 is still forecast to increase by almost 6 percent. Saudi Arabia remained a strong market for Brazilian exports in 1999, and Hong Kong and Japan also increased their purchases from Brazil last year.
Mexican poultry meat production surged in 1999 growing by 12 percent. This production increase was supported by generally low feed grain prices and dynamic domestic demand. For 2000, production is forecast to increase by an additional 6 percent as consumer demand should remain strong. Egg production in Mexico climbed 8 percent in 1999 and is forecast to grow by another 3 percent in 2000 to meet demand. However, egg imports dropped 40 percent in 1999 and are only expected to make a slight recovery in 2000 as the Government of Mexico continues to restrict access of U.S. fresh table eggs beyond the border areas. In addition, a new regulation requiring continuous refrigeration for shell eggs once they have been refrigerated went into effect in February. This is expected to continue to depress the level of egg imports.
While Russian poultry meat production appears to have stabilized, the country continues to import more poultry than it produces. Russian consumers continue to respond well to imported product. Poultry imports strengthened considerably in the last months of 1999, and are expected to remain at least as strong in 2000. Russian poultry imports, including estimated transshipments through the Baltics, are estimated at 865,000 tons in 1999, down only 7 percent from the previous year. Poultry imports in 1999 included 52,000 tons of food aid from the United States with the remaining 22,000 arriving in 2000. A customs resolution that would restrict points of entry for product arriving by ship, and would mainly affect U.S. product, has reportedly been suspended indefinitely.
China, the worlds second largest poultry producer, continues to show production increases of about 3 percent annually. Poultry imports are increasing even more rapidly to meet the growing domestic demand for protein. Net poultry imports for 1999 and 2000 are estimated at almost double the previous years levels as both direct imports and re-exports from Hong Kong have increased. The increase in direct imports stems from both the Chinese governments ongoing anti-smuggling campaign, and the longer term trade confidence in the Chinese market based on its imminent WTO accession.
Hong Kongs poultry imports jumped by 28 percent in 1999 and are expected to increase by another 15 percent in 2000. Low international prices make imported product attractive, and there is a growing local acceptance of chilled and frozen poultry versus freshly slaughtered. Re-exports to China are also increasing as Chinas improved transportation systems allow more imported poultry products to reach inland markets. There is a growing trend for U.S. products to be re-exported to China, de-boned there and then re-imported into Hong Kong for consumption. While the U.S. is still the major poultry supplier to Hong Kong, imports from Brazil also increased substantially in 1999. Egg imports continue to increase by about 2 percent annually. China is the largest supplier of eggs to Hong Kong, but in 1999 due to the weakness of the euro and the availability of export refunds, the Netherlands edged out the United States as the second largest egg supplier.
Broiler production in Thailand is forecast to increase by 7 percent in 2000, building upon the 5 percent growth seen in 1999. Strong domestic poultry consumption supports some of the production increase, and continued improvement of production technologies helps producer returns. Broiler export growth in 2000 is expected to be modest as Thai product continues to face strong competition from Brazilian, U.S. and Chinese exports. Thai producers appear to be shifting to increase sales of cooked products to Japan and the EU at the expense of uncooked products in 2000.
Japans imports of broiler meat jumped by 11 percent in 1999 in the face of slightly lower domestic production and a general strengthening in the Japanese yen. Demand for both imported bone-in leg quarters and for prepared poultry products was good. However, imports are forecast lower in 2000 as frozen inventories are worked down. Egg imports continue to show moderate growth in the face of declining domestic egg production.
French poultry production is forecast to continue to fall slightly in the face of strong export competition and sluggish domestic demand. Egg production is also forecast down 1 percent from the high 1999 level as demand is saturated and stocks are plentiful.
Poultry production in the Netherlands remains flat as future growth in this sector is tempered by consumer concerns about animal welfare issues and the impact of production on the environment. Extra-EU exports are forecast up 14 percent in 2000 to 214,000 tons, slightly above the 1998 levels. Exports in 1999 were weak as concerns about dioxin contamination affected the market.
For further information, contact Leanne Hogie (202) 720-1372.