Prices for chicken meat in the Philippines are significantly up from the lows recorded at the start of this year, as producers have been unable to fully respond to rising demand. Output over the first six months rose, but the industry is being held back by a variety of factors ranging from avian influenza (AI) movement restrictions to rising input costs.
With the return of the hotel and catering trade and rising employment, the Philippines is witnessing rising demand for chicken meat, further boosted by difficulties in the swine sector.
Over the first six months of this year, 349 million broilers were slaughtered. While higher than the same period last year, the increase was marginal compared to the 346 million birds slaughtered during the first six months of 2021, when the country was still living with lockdowns and demand stifled.
This lack of supply is resulting in higher prices, contributing to a food inflation that has been described as skyrocketing, and while the country’s Department of Agriculture is confident that there will be enough chicken meat available to meet consumers’ needs during the second half, it announced a number of measures during June and July to help ensure that this will be the case.
Government intervention
The Department’s call to bring down production costs may have been welcomed, but not all its proposals to ease food inflation have been deemed adequate to allow the industry to respond to higher costs and demand.
Industry association the United Broilers Association wants a streamlining of the compensation system for growers hit by disease outbreaks, to allow them, it says, to resume production more quickly, while it is also calling for clarity on proposed changes to meat import tariffs.
Among measures proposed by the department to help alleviate market shortages and bring down prices for consumers has been to lift the temporary bans on chicken imports from Spain, Denmark and the Czech Republic.
Of greater value to local producers, the department has also said that it will make inter-island movement from mainland Luzon, home to much of the industry, easier for day old chicks, hatching eggs and ready to lay pullets, loosening restrictions that were introduced to help control the spread of AI, which re-emerged in February. While most AI outbreaks have occurred in layer, duck and quail flocks, the broiler industry has still been affected by movement restrictions.
Some local governments, however, are reported to be applying their own restrictions, which have been stricter than those of the central government.
To help bring down feed prices, the government reports that it is in discussion with new overseas suppliers. It is also allowing the import of more vaccines to protect flock health.
Complex influences
As the Philippines’ economy has re-opened, demand from hotel and catering has returned and as consumers have returned to work incomes have risen, further boosting demand for meat.
Like producers around the world, the Philippine industry is suffering from higher feed and fuel costs. To compensate for higher feed costs, the department notes that some producers have altered birds’ diets, resulting in longer periods for birds to be market ready.
It also points to unfavorable weather conditions and adds that some farmers have held back from expanding fearing that markets would remain closed due to disease control measures.
The department continues that, while the price of eggs may have fallen slightly this year, the price of chicken has risen by as much as 25%. Despite this, fears that price rises may not be enough to cover higher input prices are also discouraging producers from expanding.
The Philippines is forecast to return to 92% self-sufficiency by year end, with total supply of poultry meat reaching 580,415 metric tons (MT) in the third quarter and 610,696 MT in the fourth. Demand for chicken meat is expected to be around 405,017 MT in the third quarter and 435,100 in the fourth.
Key stats
For the first quarter of 2022, the Philippines’ total chicken meat production stood at a little over 445,000 MT, an increase of 13% compared with the first quarter of 2021.
According to the Philippines Statistics Agency, at the end of the first quarter, the total chicken inventory was estimated at 18.7 million birds, 2.4% higher than a year earlier.
The broiler and layer inventory grew by 10.7% and 0.5%, respectively, while the native chicken population, which accounts for 43% of the total population, declined by 2.3%.
