Brazil and the U.S. dominate the export of chicken meat at the moment and are likely to continue to dominate far into the future. Nevertheless, there are other countries with the potential to develop a robust export business. To identify such countries, it is helpful to think about what makes a country competitive in chicken production. To be competitive requires a low cost of production achieved by favorable combination of grain, labor and energy costs while at the same time having a supportive business climate.
Grain exporters have an advantage over other countries in chicken production. Brazil and the U.S. are, of course, both giant grain exporters. In corn, a notable area of rising corn exports is the Corn Belt that starts in Hungary and extends through Serbia, Romania into the Ukraine. South Africa and Thailand are also corn exporters worth noting. Notable wheat exporters other than the U.S. include Australia, Canada, Argentina, Russia and Kazakhstan.
Labor Costs are of course highest in the developed countries of Western Europe as well as Japan and the United States. Labor costs are significantly lower in the developing world giving a significant advantage to places like Brazil and China and, to a lesser extent, Eastern Europe and middle income Asia. Energy costs vary widely from country to country. Some oil-producing countries have extremely low energy costs, while many countries in Western Europe have relatively high energy costs.
12 countries with export potential
Considering grain, labor and energy costs, a list of countries can be constructed that appear to have the potential for the kind of low-cost production that may provide a competitive advantage in chicken exports. A dozen countries not already exporting chicken meat in significant quantities but which might be favored in total costs are listed in the accompanying chart. Current exporters like China, Argentina, Chile and Thailand are not included in this list, although they all have excellent prospects for increasing their exports.
All of these countries, for one reason or another, have the potential to become significant exporters of chicken meat, but realistically only a very few will join the ranks of significant exporters. Success or failure will be determined most likely by business climate. Is the country conducive to doing business? Business climate is highly subjective, difficult to measure and subject to rapid change. Nevertheless, there are attempts to measure business climate including the Ease of Doing Business Index published by the World Bank. The list is arranged by position on the Ease of Doing Business Index.
Who’s on the list and why
After its success at staging the World Cub, South Africa could perhaps become a significant chicken exporting country. Several potential export countries are located on the Central and Eastern European Corn Belt including Hungary, Serbia, Romania, Ukraine and Russia. Mexico is likely to have a future export market in the U.S. In Asia, low labor cost countries like Vietnam and Indonesia may be favored. In the Middle East, Egypt and Turkey appear to have the best long-term advantages.