Bird flu to cost EU more than 100,000 tonnes in chicken exports

15.03.2017

Bird flu will cost the European Union more than 100,000 tonnes in chicken exports this year, driving them to only their second annual decline in a decade, and at a time of record output, US officials said.

US Department of Agriculture foreign bureaux pegged at a three-year low of 11.7m tonnes the bloc's broiler meat exports in 2017, flagging the setback from restrictions by importers such as South Africa and the Philippines following findings of bird flu in a range of EU countries.

EU exports at that level would be 105,000 tonnes less than the USDA has officially forecast for this year, and indeed represent an 8.9% decline, the biggest in 16 years, according to the bureaux's statistics.

"EU broiler meat exports in 2017 are expected to decrease significantly due to [bird flu-] related embargoes set out by major customers," the bureaux said in a report.

'Higher feed costs, lower broiler prices'

The decline comes at a time of rising production, pegged by the bureaux at a record 1.15m tonnes this year, a rise of 120,000 tonnes, although, at 1.0% growth, that would represent a sharp slowdown on the 4.0% expansion achieved in 2016.

"Slightly higher feed costs and lower broiler prices" in some EU countries, such as the Netherlands, are seen as slowing output this year, after strong gains in 2016 in nations including Poland and Spain.

The boost to the EU's own supplies implied by stronger output and reduced exports will slow to 10,000 tonnes a rise in the bloc's chicken imports this year, taking them to 780,000 tonnes.

"After an increase in 2016 driven by EU internal demand, broiler meat imports are expected to only grow slightly in 2017," the report said.

'Switch from other meats'

However, the EU's own consumption of chicken was seen picking up slack too, rising by 130,000 tonnes to a record 12.23m tonnes.

"Domestic consumption of broiler meat is still expected to increase more than total population growth in 2017, indicating a small increase in per-capita consumption," the bureaux said.

They cited expectations of a further "switch from other meats to broiler meat, due to the difficult economic situation in the EU region, combined with diet changes", which have boosted preference for leaner and easier-to-prepare types of meat.

Price impact - or not

The bureaux stopped short of forecasting any moves in EU chicken prices which might be needed to encourage domestic chicken consumption, and deter imports.

However, prices appear to have shown little reaction so far to the latest bird flu outbreak since it was first detected in late October, in Hungary, since spreading to a further 22 EU states.

Nor have prices picked up in Thailand which, being currently disease free, appears well placed to pick up business lost from other exporters, as Agrimoney.com reported on Monday.

Overnight Prasit Chalongchaichan, executive vice-president of Thai poultry producer Charoen Pokphand Foods, said that its export orders have increased thanks to findings of bird flu in other countries, terming "promising" the country's shipment prospects, according to the Bangkok Post.

However, Tisco Securities reported a drop in Thai poultry prices over the last week nonetheless, to 38.3 baht per kilogramme.

"Though bird flu fears continue to crop up in both the US and Asia, Thai chicken prices still softened 3.2% week on week," the broker said.
 

agrimoney

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