Global trade flows and prices may be under pressure in 2015

According to Rabobank's latest quarterly poultry report for the second quarter, global trade flows and prices are likely to remain under pressure for the rest of 2015.

The long-term effects could be significant as a result of bans on breeding stock trade imposed by several importing countries.

Producers in countries with balanced markets will continue to enjoy healthy profits.

A global approach to bird flu is more important than ever.

Rabobank expects prices to remain under further pressure over the next month.

"The poultry industry base is facing stronger headwinds than expected from feed prices due to the strong dollar, falling pork prices and increased competition from trade restrictions," said Nan-Dirk Mulder, animal protein analyst at Rabobank.

"The price of whole chicken, chicken legs and chicken feet fell further, and the price of chicken breast remained relatively strong."

in such a deteriorating situation, the decline in supply growth is very important.

This has been confirmed by countries with healthy markets, such as the United States, Brazil, South Africa and Japan, where the poultry industry still generates good profits.

Rabobank believes that a global solution to the avian influenza problem is more important than ever before. Strict biosafety standards should be implemented and industrial business models should be adjusted to solve practical problems in new markets.

The government should follow the relevant international guidelines based on avian influenza trading restrictions.

Many Asian countries that have implemented restrictions on breeding poultry trading, including China, expect further shortages in the local breeding poultry supply chain and may be affected by low supply the following year.

Poultry Industry Prospects by Region

EU: Profits recovered slightly. Trade positions will improve due to the weak euro and the possible withdrawal of restrictions on bird flu trading.

US: HPAI outbreak wave, but little impact on broiler industry. The local market demand is large and profits remain strong.

Brazil: Competitive position in global trade. Rivals exist for real weakness and are caught in the bird flu ban.

Russia: The market is not optimistic due to the continued increase in feed costs and the abolition of wheat export taxes.

China: less bird flu, but still greatly affected. Profits are at their lowest level in five years.

Thailand: Despite strong exports, supply still exceeds demand.

South Africa: Profits improved, but the outlook for earnings from exports to the European Union was more uncertain.

2015/6/29 Source: International Livestock Network