Livestock and Poultry: World Markets and Trade 2008 Forecast

According to the OECD-FAO Agricultural Outlook for 2007-2016, global economic growth was vigorous through 2006 with GDP growth for OECD member countries at 3.2% in 2006 and projections of about 2.5% throughout the outlook horizon. In per capita terms, economic growth is anticipated to be strongest in recent times, due to various factors that include the spread of technology, globalization of markets, and an income dividend due to declining population growth. In light of this, USDA FAS is expecting broiler exports to increase 4% in 2008 of which Brazil and the US account for nearly 80% of the world total. The rise in export forecasts is attributed to increases in the global economic structure, which in turn is assumed to support increases in consumption.

China is expected to increase its broiler imports by 9% in 2008 following the surge in imports in 2007, due to tight supplies and higher prices of domestic pork in comparison with its substitute, imported broiler meat, which was relatively lower in price and more available. In light of the 2008 Summer Olympics hosted in China, projections are predicting strong demand for both pork and poultry products from tourists. However sanitary issues continue to be a concern; several Brazilian and US plants have been delisted in recent weeks as a result of issues with residues and pathogens.

Broiler meat imports from the European Union (EU-27) are expected to be flat in 2008. Imports of Brazilian broiler meat will decrease in 2008, due to the new TRQ for salted poultry on Brazil, which became effective in late 2007.

Japanese imports of broiler meat are forecast to remain unchanged in 2008. Japan will be importing an increased share of broiler meat from China in 2008 in comparison to Brazilian broiler meat as Japan is a very price and product sensitive marketplace. Imports of Brazilian broiler meat, especially boneless leg meat (down 13%), to Japan throughout the first 9 months of 2007 declined as a result of higher prices and unfavorable exchange rates; Japan is instead shifting to cheaper prepared products from China.

Russia is projected to continue importing the same levels of broiler meat in 2008 that it did in 2007. The unchanged broiler meat import forecast is a result of a regulatory change in 2006 that raised the minimum price of poultry, mostly from Brazil and the US, which accounts for 90% of its total imports.

Note: (p) preliminary; (f) forecast; * US Market Share Percentage of Exports Among Major Traders; ** Change in Market Share Points; All figures in 1,000 Metric Tons Ready to Cook Equivalent. Totals include only those countries that make up USDA's official PSD database are reported. This means totals do not encompass all production, consumption and trade, but rather the sum of those countries reported in USDA's database, which represent the most important players in the world meat PSD situation. In an attempt to capture these major players, the list of countries reported changes periodically.
Source: USDA FAS Office of Global Analysis

The 2007-2016 Outlook is forecasting world market conditions for meat products to return to normal diminishing world prices. Poultry prices are expected to follow a similar trend, however they are expected to continue rising for a longer period before stabilizing, reflecting growing demand in Europe and North and Latin America. Source: USDA FAS Office of Global Analysis/Organization for Economic Cooperation and Development-United Nations Food and Agriculture Organization Agricultural Outlook 2007-2016

Note: * People's Republic of China; Chicken paws are not included in the trade data. From 2003, Columbia and Egypt are no longer included in the broiler PSD. From 2007, Australia is no longer included in the broiler PSD. From 2008, Guatemala and the Philippines are no longer included in the broiler PSD.
Source: USDA FAS Office of Global Analysis

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