Europe's poultry imports to increase
By 2016, European poultry meat imports will exceed exports by almost 300,000 tonnes.
Excluding intra-country trade, Europe's shell egg and chicken meat imports will increase in the foreseeable future.
However, higher feed costs, the possible spread of highly infectious poultry diseases, along with the impact of politics, makes it extremely difficult to assess future production and trade of chicken meat and eggs in Europe with any degree of accuracy.
On the shell egg front, indications are that some of the European Union (EU) member states, and in particular Germany, will witness a cutback in domestic production and consequently will have to increasingly turn to imports to meet growing demand. Outside the EU-27, it looks as though Russia in particular will also need to purchase increased quantities of shell eggs.
For poultry meat, or more specifically chicken meat, the picture is less clear. The trading situation in the EU-27 has changed in recent years such that, discounting trade between member countries, the Community is thought to have moved from being a net exporter to a net importer of around 30,000 tonnes (t). The Organisation for Economic Co-operation and Development (OECD) foresees that, by 2016, poultry meat imports (mainly chicken) will exceed exports by some 300,000t.
Slow egg growth
So far this decade, growth in egg production in Europe has failed to match that achieved globally, the increase between 2000 and 2006 being less than 6 percent, against more than 18 percent worldwide. Consequently, Europe currently accounts for a little more than 16 percent of world production compared to more than 18 percent at the start of the decade. For the 27 countries of the EU, the combined total production has actually contracted since its peak of 6.83 million tonnes (mt) in 2004 meaning that the 2006 level is virtually the same as in 2000 at 6.61mt.
A breakdown of the European total (see tables on chicken meat imports and shell egg imports) reveals that the decline in egg output in Western Europe has been more than offset by increased production in Eastern Europe, particularly in the Ukraine, where annual output is approaching a million tonnes, and also in the Russian Federation, where production of 2.1mt represents almost half the total for the region.
As eggs in shell are a highly perishable commodity and difficult to transport, they are normally consumed close to where they are produced. On a global basis, less than 2 percent of production is traded between countries. However, for Europe as a whole, some 8 percent of output is traded, some 95 percent of this is by EU members. In broad terms, EU member states account for over 60 percent of world trade. Two countries, the Netherlands and Germany, account for the bulk of the business.
In 2000, the Netherlands exported some 300,000t of shell eggs - a third of the world total. However, as a result of AI, from which the industry did not recover until late 2005, production and exports have fallen. Nevertheless, Dutch shipments still reached 267,000t in 2005. More than 70 percent of Dutch exports go to Germany, rising from some 220,000t in 2000 to over 273,000t in 2005. Professor Hans-Wilhelm Windhorst, International Egg Commission statistical analyst, asserts that the increase since 2000 was due to uncertainty over conventional laying cages, resulting in many small units closing and under-investment at larger operations.
With growing production volume and low production costs, Spain has become increasingly competitive, expanding output by more than 190,000t between 2000 and 2006 to 850,000t and boosting exports to over 100,000t.
Outside the EU, Belarus is the leading exporter selling 30,000t a year, while Switzerland occupies this position in the league of importers taking a similar quantity.
However, while most of the eggs on international markets are still traded among former EU-15 member states or between East European or the Commonwealth of Independent States (CIS), Poland stands out as the East-European country which has developed new markets in Central and Western Europe, while on the import side, Russia and Slovakia appear to be opening their markets to outside the CIS.
Looking forward, the OECD anticipates that growth rates for egg production in Europe will be lower than globally. The highest growth rates are expected for Eastern Europe and Russia and the lowest for the Ukraine and the EU-25 . Whether output in the EU-25 will reach the forecast 6.56 million tonnes by 2015 will depend to a great extent on the impact of the ban on conventional cages. The switch to enriched cages could cause a cutback in egg production in the EU with the result that several member states, and Germany in particular, will have to increase imports. Russia is also likely to import more shell eggs as the OECD expects an increasing egg deficit, requiring Russia to purchase some 137,000t of shell eggs in 2015 - up some 100,000t on 2005.
AI hits chicken meat output
Although the production of chicken meat in Europe has expanded by 1.4mt or around 15 percent since 2000, as in the egg sector, the rate of growth has not matched that exhibited worldwide of almost 23 percent (see tables on chicken meat production and egg production). The latest estimates for 2006 of output in the EU-27 of 8.5mt are well below the record of 8.8mt recorded in 2002 and show a gain of only 2.5 percent over 2000.
The major growth area has been Eastern Europe, where output expanded by 1.6mt or 62 percent between 2000 and 2006. Over this period production in Russia more than doubled to 1.53mt. However, the most rapid expansion took place in the Ukraine where output rose from less than 200,000t to almost 523,000t. Poland also recorded a substantial gain of more than 71 percent to 960,000t.
Outbreaks of H5N1 avian influenza have drastically cut production in both France and the Netherlands. Just as the disease situation appears to be under control in these countries and they are poised for expansion, escalating feed costs, and higher energy prices, could slow recovery.
In contrast to the shell egg sector, where only a small proportion of global production is traded, more than 11 percent of total chicken meat output is bought and sold internationally.
As with shell eggs, Europe is important in world trade for chickenmeat. However, the picture is clouded as some assessments, such as those of the US Department of Agriculture (USDA), exclude trade between EU members, while others, like the Food and Agriculture Organization (FAO) include this business.
FAO data reveals that of the world total chicken meat exports in 2005 of more than 8.1mt, Europe accounted for 26 percent, nearly all of which was from EU member states. However, USDA data indicates that of the 2.1mt exported by EU countries only about 700,000t was shipped outside the Community.
Over the past decade, exports from the EU have tended to fall as they have become less competitive, primarily due to the rise in the value of the Euro (see tables chicken meat exports and shell egg exports). Also, sales to the major markets of Russia and the Ukraine have declined in the face of competition from Brazil and the USA.
Some 30 percent of EU poultry exports are shipped to the Middle East and Asia, in roughly equal shares.
In Europe, the Netherlands is the leading exporter of chicken meat with Germany and the UK its main customers. France, the second largest exporter has seen its trade decline, losing out to Brazil, particularly in the Middle East.
Of the 3.2mt imported into European countries, almost 1.5mt is purchased by non-EU member nations. However, some 1.2mt (80 percent) of the latter is accounted for by the Russian Federation. Russia is expected to continue to import more than a million tonnes a year.
Within the Community, the UK, the Netherlands, Germany and France are significant buyers.Of the 650,000t of chicken meat the EU imports this year, most will come from Brazil and Thailand. Of particular note are recent purchases by Brazilian meat exporters of European processors.