After the devastating outbreak of AI in the US this year, the Rabobank Poultry Quarterly Q4 report, published on 2 December, said the industry was rebalancing, but claimed the poultry outlook for 2016 was “positive”.
Feed prices are expected to remain low, while competitive protein prices for beef and pork will be relatively high.
So, what does this means for the poultry industry?
It means poultry will benefit from a strong price advantage over other forms of protein. And a price advantage will help keep demand for chicken high as consumers of beef and pork will seek out cheaper forms of meat.
Rabobank analyst Nan-Dirk Mulder, added: “The extent to which the global poultry industry will benefit from these positive fundamentals very much depends on balancing supply and demand.
“After a relatively long bullish market situation, many global markets have entered a period of oversupply at the end of 2015, with falling chicken prices, and this needs to be solved in the next few months in order to make the industry profitable again.”
Avian influenza (AI) remains a “wild card” for the industry and the sector will require “further investments in biosecurity, improved industry structures and business models”, claimed the report.
Interestingly, Rabobank’s report comes after research from Moody’s Investors Service claimed the poultry industry was “better” equipped to handle a future outbreak of AI.