International News Analysis: Global poultry industry faces volatility The pandemic will continue to shake international poultry markets for the next six months. But it will also lead to some permanent changes.
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Remote working here to stay According to Nan-Dirk Mulder, senior analyst of animal protein at Rabobank, across Europe, COVID- will push structural change in the poultry industry in Europe, and the shift from out-of-home to at home will to some extent remain permanent. In a recent AVEC webinar, Mulder said the shift to remote working will alter the poultry
“Balancing local supply with volatile demand will be the big challenge for global producers, and the experience so far this year shows how difficult this is,” says Mulder. Differences in expected poultry production growth are bigger than ever, ranging from 15% growth in China to 5% in Vietnam, contrasting with -8% in Thailand and more than -10% in India.
East Yorkshire poultry business creates new role to drive continuous improvement
2020 has been a volatile year in the global poultry industry, with huge disruption to the foodservice and wholesale markets, and increased demand from retail. This volatility likely to continue for at least the next six months, but the COVID-19 pandemic will also lead to more permanent changes. There will be a permanent shift to more online grocery shopping, with Tesco predicting demand will be up to 1.8 million shops per week by the end of the year, compared to 600,000 in January. In addition, the breakthrough of remote working will change poultry markets forever, with food service outlets catering to office workers becoming redundant. European poultry markets have been disrupted like never before with food service demand down 40% in 2020 compared to 2019. Predicted sales for 2021 by Rabobank show foodservice sales will be down 10% compared to 2019. Across Europe, the sudden drop in demand through food service led to a sharp drop in prices. There are still big challenges in balancing supply and demand. The gradual easing of restrictions since July led to some increase in foodservice demand, although it is still down significantly. The forthcoming recession is likely to benefit sales of poultrymeat and eggs, as consumers trade down from more expensive proteins.
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market forever with 75% of companies surveyed saying some staff would continue to work remotely. This will drive a permanent shift away from the food-to-go market, lunchtime restaurants, and into fresh, premium products. African Swine Fever drives poultry consumption Over the whole year, there is likely to be a slight increase in global poultry production (+0.8% YOY). This is the result of poultry expansion in China and Vietnam – where African swine fever (ASF) has reduced pork availability – and also from expansion in the US. The rest of the world will be operating in an environment of shrinking production. There is a global shift from foodservice to retail, benefiting retail-focused companies. Global trade is very competitive and volatile, with most impor t markets reducing volumes. “ Trade into ASFaffected markets like China, the Philippines, and Vietnam has become more important, and this raises risks as local production recovers. “Exporters like Brazil, the US, and Russia are focused on China, with export volumes e x p a n d i n g q u i c k l y, b u t w i t h p r i c e concessions,” according to Mulder. Prices are highly pressured for all cuts, especially breast meat, legs, and feet.
East Yorkshire poultry supplier Soanes Poultry has promoted from within to fill a new role that will help to support its growing business. The company has promoted Petra Kdr to the new position of Continuous Improvement Officer. Kdr joined Soanes Poultry in 2012 and has worked in a quality improvement and primary processing roles before her latest move. “My experience in operations from slaughter to packing will be very useful in this new role as I support the Senior Management team in their bid for continuous quality improvement,” she said. Soanes Poultr y's managing director, Nigel Upson said: “Petra has been a valued member of the Soanes team for nearly a decade and her well deserved promotion comes as we enter the final phase of a two year expansion plan that will increase production by 20% and create 15 new jobs. “Petra will be working on new product development, project management and efficiency studies as we continue to grow our business.” Poultry Planner | Vol. 22 | No.08 | October - 2020
