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Canada's Poultry Sector to Grow in 2014

01 August 2013
USDA Foreign Agricultural Service

CANADA - Under Canada’s supply management system, poultry farmers are able to pass on production costs to processing plants, making them less vulnerable to fluctuations in feed prices. Given that competing proteins will remain in short supply and will show increased prices, the poultry sector will take advantage of the situation and present a moderate growth in 2014, after a better than expected performance in 2013.

Anticipating feed prices to remain within tolerable margins, and given a relative short supply of red meats at elevated prices, Post forecasts a moderate growth of 1.4 percent in broiler meat production in 2014, up to 1,070,000 metric tons (MT).

For 2013, Post estimates the broiler meat production to be 1,055,000 MT, a level reflecting a better than expected performance in the sector, as the industry steadily increased production throughout the year to meet a solid demand. As such, the 2013 broiler meat production is estimated to be 1.7 per cent higher than in 2012.

Canadian imports of chicken meat are regulated under a tariff rate quota (TRQ) which is a function of the previous year's production level. The global quota for 2014 is projected at 79,100 MT. In 2013 the TRQ level is 77,800 MT.

In recent years, Canadian poultry companies have been increasingly utilizing the Department of Foreign Affairs, Trade and Development’s (DFATD) Imports for Re-Export Program (IREP).

Through IREP, Canadian chicken processors import chicken meat duty free for use in processing, provided they re-export the associated processed products. As a result, total chicken imports are about double the TRQ volume, as attributed to IREP imports.

The year 2012 marked the emergence of a new trend in the imports for re-export business, namely the use of a competing program offered by Canada Border Services Agency (CBSA), the Duties Relief Program. Post anticipates that by 2014 half of Canada's imports for re-export will be part of CBSA's program, to the detriment of the traditional IREP.

Moving into 2014, Canada’s turkey market will remain flat, with production forecast to stay at 165,000 metric tons, virtually unchanged from 2013.

Further Reading

You can view the USDA GAIN: Canada Poultry and Products Annual 2013 report by clicking here.

ThePoultrySite News Desk

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