Consumer demands will strongly influence animal protein – and, therefore, animal feed – production in the coming year, according to Nan-Dirk Mulder, senior analyst, animal protein, at Rabobank.
Mulder presented “Global poultry and feed outlook: Key investment trends shaping the industry in 2019” at the first Feed Strategy Conference, hosted by WATT Global Media, at the International Production & Processing Expo in Atlanta on Wednesday.
Here are 14 key takeaways from his talk:
- Worldwide, there will be 35 percent more demand for animal protein in the next 20 years. Poultry will see the largest increase, about 2 percent, while expansion for eggs will be 1.6 percent; seafood, 1.2 percent; beef, 1.1 percent; and pork, 1 percent.
- Consumer demand is changing while economies develop; wealthier countries consumer more meat. Australia has the highest global per capita consumption of meat in the world.
- Social changes can affect the outlook for animal protein markets: Retail sales of meat substitutes are highest in Asia-Pacific and lowest in Latin America.
- The cost of poultry production varies significantly from region to region. The cost of live broiler production is the highest in Japan and lowest in Brazil.
- Brazil’s meat and poultry industry are seeing challenging market conditions. Brazil is very export focused, but facing trade challenges in several regions.
- There is a lot of volatility coming from Europe and the Mideast. EU chicken imports from Brazil are down 50 percent, while the EU increases imports from Ukraine.
- U.S.-China tariff battles will further shake up trade in Brazil. China imports 62 percent of the global soybean trade and is importing more soy from Brazil and Argentina.
- Outbreaks of African swine fever (ASF) in China will affect pork markets and the industry structure in the coming years. ASF is “going to have a huge impact on global markets,” Mulder said.
- Because it has been very difficult in recent years to import grandparent broiler stock into China, the demand for chicken will not be supported by enough supply.
- South and Southeast Asia will be the key global markets for growth, including Indonesia, Myanmar, the Philippines, Vietnam and India.
- Excluding Brazil, Latin America is offering some of the fastest-growing poultry markets in the world.
- Poultry markets in Africa will rise 5 percent annually in the next decade. The biggest growth will be in South Africa and Nigeria.
- Social concerns are opportunities to differentiate markets. Food safety, animal welfare, environment, consumer health and local supply are big trends.
- New technology will help to solve key supply and social challenges.
Feed Strategy Conference was presented by WATT Global Media and Feed Strategy and sponsored by Alltech, Borregaard LignoTech, BV Science, Delacon, Evonik and PMI.