Rabobank analyst Nan-Dirk Mulder comments: "Global poultry fundamentals for 2014 look positive, with cost relief coming from lower feed costs, high prices of competing proteins and recently improved export volumes, but supply growth discipline will be the key element between profitable and non-profitable industries under these bullish market fundamentals."
Bucking a five year trend, producers in the Western Hemisphere outperformed their counterparts in the East during the third quarter and through most of 2013.
The robust profitability in the Americans of the last few quarters is expected to continue in 2014, with poultry pricing benefitting from tight supplies of pork and beef, although the recent slowdown of Asian demand may cause a new challenge for the industry.
For Europe, the latest projections for 2014 indicate growth of 0.6 percent, which is estimated to be in line with EU demand. Under such circumstances, the industry should be able to benefit from favorable market conditions with tight pork and beef markets and lower feed prices.
Conditions in Russia are improving after a tough year, and the country will benefit from price support from the local government.
In South Africa, the outlook is mixed. While the poultry industry will enjoy new safeguards from Brazilian imports, the country will experience large and growing imports from the EU.
Mulder comments: "Despite the broadly positive global outlook, the challenge remains to keep markets balanced. Key Asian markets of China and India are in the midst of a supply glut because of weak demand following food safety and animal disease issues in the former and slower economic growth in the latter. Early indicators for 2014 reflect better conditions for both markets as supply levels tighten but, in the case of Thailand, a big concern will once again be oversupply."
In Mexico , the industry is rebuilding domestic supply but there is a lingering risk that bird flu will reappear this winter as temperatures fall.