Global Demand Predicted to Propel Poultry Sector

NEW YORKDespite the current turbulent environment and the challenge of meeting a 30% rise in global demand in the next 10 years, the prospects are bright for the global poultry market, according to a new report from Rabobank.

According to the Crossroads for Growth: The International Poultry Sector Towards 2020," Brazil and other emerging markets have started to internationalize and diversify the global poultry industry as markets in Europe and the United States become saturated. The result is a changed competitive environment, with new players entering new markets and equity players taking up positions in the industry hoping to benefit from the opportunities.

Poultry is going to be the winning protein in the next decade as the world population expands and incomes rise," said Nan-Dirk Mulder, lead author of the report. But it will be a big challenge for the industry to keep up with the 30% demand growth in the next 10 years, growth which is not distributed evenly around the globe."

Growing demand in Asia is a key driver for the expected growth in the global poultry industry since the feed crops that fuel the industry are most abundant in North and South America; future global investments will increasingly be a two-way street between American and Asian companies. The success of the Brazilian model, together with the need for U.S. companies to find new markets, will drive further internationalization of the industry as Asian players will seek to secure future supply for their home markets

While Brazil will remain the dominant player in the export meat market, countries like Ukraine and Argentina have great long-term growth potential. Thailand and China will remain dominant suppliers of labor-intensive poultry products while the United States and the European Union will be more access" supply exporters. The EU poultry industry will adapt an increasingly regional focus to better exploit the opportunities of its 500 million consumer base. China, India and South East Asia will be relatively hot" for foreign investors and may also offer trade synergies with existing business.

The report also noted sustainability is going to be a much more important topic in the new market environment.

NGOs and clients will be more concerned about the sustainability of poultry production At the same time, animal welfare will become more important," Nan-Dirk Mulder said. Suppliers in developed markets will need to be proactive in the debate, while retailers and QSRs offer opportunities to set up production chains with higher animal welfare standards to supply the premium market segment."