Improved margins for poultry producers as imports threatened

However, while reduced input prices are good news for poultry producers, future supplies are very much dependent on the spread of the high pathenogenicity HPA1 avian influenza cases.

According to a Rabobank report, the poultry sector is enjoying significant feed cost reductions in cereals and oilseeds, which in turn, it claims, should enable chicken products to become more affordable to consumers.

"Projected poultry costs for 2023 are estimated to be 10-15% lower than the historic highs of 2022 and global feed costs are expected to continue falling," said Nan Dirk Mulder, senior analyst of animal protein at Rabobank.

Nevertheless, supplies remain tight in some regions of the world, to include Mexico, Russia, Malaysia and parts of Europe, with other countrys, such as America, Thailand and Japan, seeing increased production. Furthermore, with poultry proving to be less expensive than beef and pork, demand is expected to increase.

In its report, Rabobank pointed out that the global poultry trade increased to 3.5m metric tonnes in the first quarter of 2023, with Brazil being the front runner having increased its exports by 17%. But, with the increasing risk of the HPA1 bird flu, future trade could be restricted.

"Brazil and especially its poultry producing southern states remains at high risk should an HPAI outbreak occur in commercial flocks," said Mr Mulder.

He added that such incidences could have a major impact on global trade particularly with breast meat and whole chicken prices likely to be affected. As a result, Rabobank believes importing southern hemisphere countries could face tight supply issues with others in Europe and Latin America, also likely to be affected.

The risk of avian flu is also putting further pressure on eastern Latin America, north east Asia and southern Africa, for the remainder of the year, thereby adding renewed risk to Europe and America.