Japan’s broiler industry is doing rather well. It is only three years since the country was hit by an earthquake, tsunami and nuclear disaster, yet chicken meat output is already above pre-disaster levels.
Japan’s broiler producers have recovered much more quickly than expected, despite the additional problems of high input costs and, more recently, disease outbreaks.
The country is the 14th largest - if the members of the EU are treated as a whole - producer of broiler meat in the world, and one of the top 10 largest producers if EU members are ranked separately.
The Japanese poultry meat industry consists of 90 percent broiler production, with the remainder accounted for by the processing of spent hens. Although it still has issues to overcome, 2012 saw the Japanese poultry industry produce its highest volume of meat – 1.325 million metric tons – since 1990.
This was followed in 2013 by a slight contraction to 1.305 million metric tons, due in part to a particularly hot summer in two of the country’s three major producing areas. Forecasts for 2014 suggest that output will be at a similar level to last year.
Changing demand for meat
After several years of overall weak domestic demand, growth in consumer spending in Japan is predicted to be higher this year. The country’s broiler meat consumption for 2014 is expected to be in the region of 2.155 million metric tons. Although this is a slight contraction compared with last year, Japanese consumers have consumed more chicken meat almost every year for the past decade.
Alongside this growth, consumer tastes for meat type has changed. Traditionally, Japan was a country with a preference for dark meat, however, demand has grown significantly for breast meat.
Foreign competition
Strong domestic supply, together with a weaker yen, have eased competition from poultry meat imports on the Japanese market, putting the country’s producers in a relatively strong position. However, like other producers around the world, Japan’s broiler industry has had to cope with high input prices in the form of more expensive feed costs, so affecting margins.
The country has a relatively strong supply of low-cost breast meat, meaning that local producers are able to satisfy much of the demand for product to use in ready-to-eat food and in the food service sector. Yet the country is not self-sufficient; reflecting the importance of these two market segments and changing consumer preference, in 2013 demand for imported processed broiler meat was higher than for raw meat for the first time ever.
With the return of Thai exports, which had been halted due to concerns over avian influenza, to the Japanese market in December last year, importers now have a greater choice from which to supply and this will allow them to put further pressure on prices. Should this occur, local producers may find themselves in a position where they need to reduce prices to remain competitive.
And this year, Japan has had its own avian influenza outbreak to deal with. In mid-April, highly pathogenic avian influenza virus H5N8 was detected in Kumamoto in the south of the country. More than 100,000 birds were killed on affected farms and movement and shipping restrictions were imposed. These were lifted by May 1, and no subsequent outbreaks have been reported.
