U.S. broiler markets are still weak, and prices are depressed. As a result, poultry production is likely to slow down in 2019. Nan-Dirk Mulder is a senior analyst for animal protein at Rabobank, who says the outlook for the global poultry industry will gradually improve as the year progresses.
The biggest improvements likely arrive in the second half of 2019, thanks to rising Chinese imports spurred by the impact of African Swine Fever on protein demand in the country. That demand is expected to lead to more poultry imports, especially from the U.S. However, the market is struggling with oversupply from record-high broiler and red meat production that’s resulted in low domestic prices and high cold storage levels. That means the market needs to rebalance itself before things head in a positive direction.
Rabobank’s Poultry Quarterly report says record broiler production at 3.89 billion pounds during October has pushed boneless breast meat prices well past historical lows. Most of the big-bird operations have seen sizeable losses in recent weeks, with the small-bird options faring just slightly better on production that’s down eight percent year-over-year. “Chicken demand remains weak as large supplies of competing proteins, especially pork, make for a very competitive retail marketplace,” says Mulder.