Global poultry trade and poultry prices are expected to remain under pressure for the remainder of this year due to the challenges posed by avian influenza. The long-term impact may be significant due to several trade bans on breeding stock in importing countries.

“Poultry industry fundamentals are facing meaningful headwinds with stronger than expected feed prices due to a strong US dollar, increased competition from falling pork prices and restrictions on trade,” says Rabobank animal protein analyst Nan-Dirk Mulder. “Prices for whole chicken, leg quarters and chicken feet are declining further, while breast meat prices remain relatively strong.”

Many countries in Asia, including China, which have implemented restrictions on trade in breeding stock, might be affected by low chicken meat supply next year due the expected future shortages in local breeding value chains.

However, the bank predicts that producers in countries with balanced markets will continue to enjoy healthy markets. Supply growth discipline is important under such worsening conditions, Rabobank continues. This has been proven by countries with healthy market balances in their markets, such as the US, Brazil, South Africa and Japan, where the industry is still making good margins.

Regional performance

The EU is expected to see a slight margin recovery over the rest of this year. Its trading position will improve due to the weak euro and possible lifting of avian influenza related trade restrictions.


The U.S. will continue to experience a wave of highly pathogenic avian influenza outbreaks. Margins, however, will remain strong, on robust home market demand.

Brazil, the bank predicts, will continue to maintain its competitive position this year, boosted by the weak real and avian influenza bans placed on its competitors.

Russia has a less bullish outlook, with ongoing higher feed costs and the removal of the wheat export tax.

China is expected to experience fewer avian influenza cases as the year progresses, yet they will continue to have a significant impact on the poultry industry, and margins are expected to be the lowest for five years.

Thailand is expected to face oversupply, despite strong exports, while in South Africa, margins will improve, but the outlook there is cloudy due to the likely return of EU exports.