What’s happening in the European poultry industry?

The European poultry has faced difficulties on various fronts, all ow which have combined to result in, what it describes as “the perfect storm.”

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The costs of Brexit are currently being felt primarily by the U.K. poultry industry, however, European producers will face similar regulatory burdens once the U.K. introduces its own import rules. | (koya79 | iStock.com)
The costs of Brexit are currently being felt primarily by the U.K. poultry industry, however, European producers will face similar regulatory burdens once the U.K. introduces its own import rules. | (koya79 | iStock.com)

Nowhere has escaped the difficulties of COVID-19, but for European poultry producers, various circumstances have combined to see the industry living through “the perfect storm”, says the region’s industry association AVEC.

Chicken meat consumption has fallen due to the closure of foodservice and the HORECA sectors, but disease outbreaks, altered trade relationships, and rising costs, along with pressure from both governmental and non-governmental organization, have all been hitting the region hard, AVEC reports.

The difficulties that emerged last year, and which saw output within the Member States of the European Union (EU), excluding the U.K., decline by 0.5% to 13.8 million metric tons, have continued into and, in some cases, worsened in 2021.

HPAI

Up to June 2021, Europe recorded over 1,200 cases of highly pathogenic avian influenza (HPAI). The disease emerged in 22 countries resulting in bans on exports from those countries affected.

While countries have worked to see their disease free restored, new EU legislation has made this more difficult rather than easier. The EU 2020 Animal Health Law, which sets out new ways of handling avian influenza outbreaks, particularly with regard to restocking and surveillance zones, needs revision, the association argues.

On a more positive note, however, AVEC welcomes the revision of OIE guidelines earlier this year, which now recommend that trade suspensions following an HPAI outbreak should be reduced from three months to 28 days.

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Changes to European Union legislation have made restocking farms more difficult following an outbreak of HPAI. | (sharafmaksumov | Bigstock.com)

Brexit and wider trade

Brexit is another contributor to the industry’s perfect storm and, while its impact is currently being primarily felt in the U.K., difficulties are set to increase and impact the EU.

New rules have been applied to U.K. exports since January 1, and exporters there must now contend with higher costs, largely due to a greater administrative burden. There is significant risk that EU sales to the U.K., which is an important for European exporters, will face the same challenges once the U.K.’s new rules on importing from the EU come fully into force.

Despite U.K. restrictions not yet being in force, sales from the EU to the U.K. declined by 19% between January and May this year, while Europe’s imports from the U.K. were 25% lower.

Beyond trade with the U.K., COVID-19 and HPAI have been the main influences on exports.

In 2020, Europe’s exports contacted by 5% to 1.7 million metric tons, while imports were lower by 14% at 510,000 metric tons.

Not all export markets have been negative for European producers. Over 500,000 metric tons were shipped to Africa during the first quarter of this, making Africa the region with the highest upturn in demand or European poultry meat.

Not all of Africa, however, has been quite so receptive to European exports, and the association remains unhappy about its access to the South African market. Once a major destination for European exports, AVEC is calling on the European Commission to take action against South Africa’s “unjustified” measures to protect its home market and producers.

Also of concern to the association is the pending finalization of the free trade agreement with South American regional grouping Mercosur, which would give additional concessions of 180,000 metric tons of poultry meat. AVEC has said that it would welcome the agreement’s rejection.

Feed prices

The price of feed has continued to rise this year, due to adverse weather in key producing countries and huge import demand from China. This upturn in demand from China, where the meat industry is experiencing a recovery, is problematic for poultry producers as feed tends to account to 60-70% of production costs.

Antibiotics

The EU’s Farm to Fork Strategy, launched in May this year and which seeks to transition to a sustainable food system, includes ambitious veterinary antibiotics reduction targets. While these have been welcomed by AVEC, the association, nevertheless, has expressed concern.

The European Commission wants sales of antimicrobials used in farmed animals to be cut by 50% by 2030, and AVEC fears that the efforts already made by the poultry sector will not be recognized.

In several EU countries significant reductions in antimicrobial use have already been made and it warns that they should not be penalized for their early action.

Labelling 

AVEC wants mandatory origin labelling on all poultry products, detailing if meat was produced inside the EU or beyond. This level of transparency should also be extended to restaurants and school canteens.

Such labelling, it says, is vital for the sector and would illustrate the high standards to which European poultry is produced when compared to production outside of the region.

It also wants enhanced marketing standards, particularly for new production methods, and especially in terms of the water to protein ratio in meat.

With regard to farming methods, the association would like to see the introduction of a flexible, voluntary scheme and is reviewing national schemes to evaluate the importance of various production system criteria.

 

The Berlin Declaration

In September, AVEC published The Berlin Declaration, under which it, and its members, commit to develop and promote a Sustainability Charter.

The charter will be presented at the start of 2022 and will seek to find the best balance between the three pillars of sustainability: Environmental, Social and Economic.

All stakeholders in the production chain – including representatives from breeding companies, farmers, food processors, academics and scientists – are contributing to the process.

The declaration goes on to state that the industry is aware that society and politics in the EU are engaged in an intensive discussion about livestock farming’s future, and that it will play an active part in that discussion.

To ensure a fair transition towards more sustainable European poultry meat production, EU authorities must guarantee, and enforce, a level playing field with international trade partners and require identical rules for imported poultry meat, the declaration continues.

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