China Broiler Market Weekly - CHINA - In this weeks broiler report, eFeedLink say that prices decline as demand continues to fall, week ended Nov 23, 2005.

1. Price Summary

Fresh outbreaks of bird flu in the provinces of Shanxi and Hubei as well as Inner Mongolia AR have dampened severely China's broiler prices in the past week. In non-affected areas, there were also few buyers for broiler stocks held by sellers. As cross-province transactions have fallen significantly, broiler producers could only hold on to their stocks and bide their time.

During the week in review, sales of day-old chicks have come to a standstill while eggs meant for breeding were redirected to the commercial market. Long distance transportation of live birds has also been restricted. Slowing sales of broilers have thus kept stocks of frozen broilers at a high level. Across the country, poultry trading activities have fallen sharply as wholesale markets remain close.

Despite ongoing efforts by the agriculture and health ministries to keep the outbreaks under control, China's broiler prices were not likely to recover soon.

2. Market analysis

In Liaoning and Shandong, broiler exports to other provinces have been prohibited. Thus, broiler stocks have to be kept until the outbreaks are over. Due to weak demand, prices of live birds that could only be sold domestically were subjected to greater downward pressure.

In Henan, broiler prices were generally mixed. Prices were up slightly after the government announced the re-opening of the live poultry market. However, fresh outbreaks of bird flu led to the closure of the live poultry market once again, and prices gave up their initial gains. Live poultry exports from Henan have also basically come to a standstill.

In Jiangsu, prices of white-feathered broilers were sharply lower and broiler producers there have incurred heavy losses. Broiler consumption has continued to fall at a time when broiler exports to other provinces were suspended.

In Guangdong, broiler prices were generally dismal. Broiler demand continued to shrink as consumers increasingly rejected poultry products. Consequently, broiler sellers were unwilling to procure more broilers. Across the province, poultry transactions have declined.

In Guangxi Zhuang AR, broiler prices have recovered in the past week. Faced with losses due to the bird flu, a few major broiler producers decided to suspend broiler sales on November 17 and 18. Due to the reduced supply of broilers in the market, prices began to pick up to levels generally higher than those recorded in the previous week.

3. Market forecast

As many live poultry markets across China remains close, the threat of bird flu has continued to haunt poultry producers and consumers. With weakening demand, broiler prices are set to fall further in the near term.

Source: eFeedLink - 24th November 2005