EU-27 Poultry

The EU-27 broiler market recovered from a 2006 decline caused by HPAI (High Path Avian Influenza) outbreaks, but production was restrained due to outbreaks of Highly Pathogenic Avian Influenza (HPAI) H5N1 in wild birds and in small poultry operations in several countries in 2007. Higher domestic consumption resulted in a 1% increase in broiler meat production estimates for 2008. In 2007, poultry production in general rose 3.8% while the producer price rose 8.1%. The limited increase in production helped increase EU poultry prices to record levels and kept production margins positive even with increased feed costs.

The European Union is expected to become a net broiler meat importer in 2008. Domestic consumption is growing at a faster rate than production and broiler meat imports are trending higher at the same time that exports are declining. Brazil is the primary chicken meat supplier to the EU-27. In 2007/2008 Brazil is expected to fill its tariff rate quota and even over-quota imports in 2008 may still be profitable for Brazil’s poultry exporters.

In 2006 the European Union concluded an agreement with Brazil for a new TRQ on salted poultry meat (HS code 02109939), preparations of turkey meat (HS 160231) and cooked chicken meat (HS16023219). Brazil was allotted 170,807 MT of salted poultry meat; 92,300 MT of preparations of turkey meat; and 73,000 MT of cooked chicken meat.

The trade dispute between the EU-27 and the United States on Pathogen Reduction treatments (PRT) on poultry carcasses has not been resolved. The EU banned poultry meat imports from the U.S. on April 1, 1997 because of a disagreement on anti-microbial treatment. U.S. poultry producers use washes of low concentration pathogen reducing treatments to reduce the level of pathogens in poultry meat production, a practice not permitted under EU sanitary regime. During the November 2007 meeting of the Transatlantic Economic Council, the EU committed to act definitively to resolve the long-standing issue regarding the importation into the EU of U.S. poultry treated with pathogen reduction treatments before the next U.S.-EU Summit.

Source: USDA/Foreign Agricultural Service Attaché Report; Eurostat News Release 35/2008; U.S. Trade Representative press release

U.S. Broiler Exports Remain Strong

Broiler exports in 2007 were up 11% from 2006, while turkey exports increased 1.3%. Broiler exports are forecast to reach 6,000 million pounds in 2008 while turkey exports are forecast to top 605 million pounds. A number of major markets benefitted from the weak U.S. dollar. Disease issues in China’s hog industry contributed to a 24% increase in broiler shipments. Egg and egg product exports (including hatching eggs) reached 251-million dozen on an egg equivalent basis in 2007. Much of the growth in 2007 can be attributed to shipments going to the EU-27 countries.

Source: USDA/Economic Research Service Livestock, Dairy and Poultry Outlook www.ers.usda.gov

Further Reading

-

You can view the full report by clicking here.