12 September 2012
Note - Structure of Japanese Broiler Market:
Broilers comprise over 90 percent of the Japanese poultry meat market. In general, leg meat is preferred to breast meat in this market. Domestic broilers account for roughly 60 percent of Japan’s total broiler supply. Nearly half of Japan’s total broiler meat imports are supplied by Brazil (mainly boneless leg meat) with the rest coming mostly from Thailand and China, who mainly export “prepared (or cooked) broiler meat.” Note: Since 2004, Japan has suspended its imports of broiler meat from Thailand and China due to massive HPAI (Highly Pathogenic Avian Influenza) outbreaks that swept through the region.
Japan’s retail sector is the main market for domestic broiler meat with the food service/convenience/take-out meal sectors being the main market for imported broiler meat and prepared products. Japan was once a major market for U.S. bone-in legs; this specific trade segment has shrunk over the past two decades, however, due to a shift in market preference for boneless cuts, and, more recently, prepared (cooked) products. The U.S. poultry industry is very competitive in the international market and historically has focused on export markets that take bone-in cuts. The lack of the U.S. industry’s capability to produce and export deboned cuts, coupled with prohibitive labor costs, has also been a major constraint for U.S. broiler meat in this market.
Japan’s 2012 national broiler output has nearly recovered to its 2010 level of 1.29 million MT after a decline in 2011 due to HPAI outbreaks and the 2011 March earthquake. Currently, an oversupply of unsold broiler meat, along with high level stocks and plummeting market prices are all indicating the severity of the surplus. By mid-2012, total supply clearly outpaced total consumption, despite the fact that annual consumption is projected to reach a record high of 2.14 million MT. Total imports are expected to be significantly reduced for the second half of 2012 through the first half of 2013. Prevailing low prices and high feeding cost (due to high corn prices) may also press domestic producers to trim their output in 2013. Therefore, in 2013, lower imports and national output are expected to correct the current surplus.
2013 Broiler Market Outlook (New)
Given global economic uncertainty, exacerbated by the historic drought in the United States, average Japanese consumers are expected to continue to favor relatively low-priced food items including broiler meat and prepared (cooked) broiler meat products.
The Japanese broiler market is expected to adjust from the second half of 2012 through the first half of 2013, correcting the surplus that developed by mid- 2012. The high corn price that is anticipated for 2012/2013, due to a severe drou
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