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USDA International Egg and Poultry


18 March 2015

USDA International Egg and Poultry - 18 March 2015USDA International Egg and Poultry - 18 March 2015


USDA International Egg and Poultry

Production

USDA FAS/Moscow unofficially forecasts Russian poultry production to hit 3.4 million metric tons (MMT) in 2015, 4.5% increase in broiler meat production when compared to revised production estimates for 2014. Despite a challenging economic environment in 2014 Russian broiler production was relatively strong, which is why USDA FAS increased its production estimate for Russia by 1.5% to 3.25 MMT, almost 8% higher than 2013 production levels. Industry profitability declined in late 2014 due in part to the depreciation of the Ruble, who’s volatility also impacted production costs like price increases on feed, imported hatching eggs and day old chicks, production equipment, veterinary drugs, and vaccines.

Previous investments and modernization projects, which started in 2006 with the National Program of Agricultural Development, have come to fruition and demand for broiler meat remains relatively strong when compared to other meats. However no investments are expected in the short term given the country’s economic situation. In fact, bankruptcies and acquisitions of some inefficient and indebted businesses are possible. According to sources, annual poultry production increased 2.6 MMT over 9 years and Russia is expected to reach is self-sufficiency target in 2015 by producing domestically over 90% of the poultry meat consumed in Russia.

Consumption

Russian broiler meat consumption is unofficially projected to reach 3.68 MMT in 2015, nearly a half percent more than revised estimates for 2014 (3.66 MMT). Average per capita broiler meat consumption in Russia has increased nearly 180% over the last 15 years. Despite higher prices to consumers in 2014 (e.g. +25% broiler carcasses, +17% quarters) broiler meat remains competitively priced compared to red meats. Additionally, Russian meat processors increasingly used poultry meat as a raw material in 2014 given its competitive price when compared to other meats and this trend is expected to continue.

Trade

Broiler meat imports in 2015 are unofficially forecast to drop 30% to be 320,000 MT or about 130,000 MT lower than 2014 levels (450,000 MT) due to ongoing restrictions on certain foreign suppliers, reduced market opportunities for foreign products due to the Ruble’s depreciation, and increased domestic production. The import estimate for 2014 was increased 17% to 450,000 MT. Significant increases were seen in 2014 from Argentina (+165%), Belarus (+30%), Brazil (+150%), Serbia (+140%), and Turkey, which first appeared in 2014.

Russian exports are unofficially forecast to total 40,000 MT in 2015 and 42,000 MT in 2014. While a significant portion of Russian broiler exports to Asia continue to be comprised of sub-products in 2014, USDA FAS estimates Russia will export nearly 20,000 MT of broiler meat to non-CU member countries in 2014. A small decline in broiler meat exports is anticipated in 2015, when compared to 2014, due to demand for domestic broiler meat, Russian exporters are also expected to potentially avail themselves of new export opportunities given the attractive prices they may be able to offer for Russian poultry in the international market.

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