Global Poultry Market Outlook for 2024: A Bullish Forecast Amid Rising Demand and Key Challenges

The global poultry industry is poised for a strong recovery, with RaboResearch forecasting a bullish outlook for 2024. After several years of slow growth, global poultry consumption is expected to accelerate, reaching an estimated 2.5% to 3% growth rate, which marks a return to historic levels of expansion. This positive trend is largely driven by favorable production conditions, increasing retail demand, and rising sustainability strategies that continue to support poultry’s dominant position among animal proteins.

A Bullish Outlook for Global Poultry Markets

According to the latest report by RaboResearch, poultry markets around the world are expected to experience significant growth in the coming year. Poultry’s price advantage over other proteins, along with recovering foodservice demand and an increased focus on sustainability, is leading to a resurgence in consumption across most markets.

“Poultry’s strong price position against other proteins in most markets, along with strong retail demand, recovering foodservice demand, and rising sustainability strategies that support chicken demand are supporting rapid growth,” says Nan-Dirk Mulder, Senior Analyst – Animal Protein at RaboResearch.

This recovery comes after a period of slower consumption growth in the poultry sector, but the outlook is now brighter as the global market moves toward higher consumption levels. However, while the overall market conditions are strong, there are some notable exceptions where local challenges continue to affect performance.

Challenges in China and Japan: Oversupply and Lower Consumer Confidence

While most global poultry markets are performing well, China and Japan are experiencing a more difficult economic environment. Both countries are facing challenges stemming from local oversupply, which has created a situation of relatively low prices and rising stock levels. These conditions have been exacerbated by fast production growth, combined with lower consumer confidence and tougher economic conditions.

As a result, imports of raw chicken to both China and Japan have dropped sharply year-on-year in the first half of 2024. Local markets are struggling with high stock levels, which has weighed down demand for international imports. In contrast to this, many other regions are experiencing robust demand for imported poultry.

Global Poultry Trade: Growth Amid Volatility

Despite the challenges faced by some markets, global poultry trade is forecast to remain strong for the remainder of 2024. As consumption rises in key importing regions, demand for chicken imports is expected to grow, especially in markets such as Europe and Asia, which continue to perform well.

Processed chicken products and value-added poultry offerings are likely to see a recovery after several slow years, with prices for breast meat and processed poultry expected to remain stable. In advanced economies such as Europe, the U.S., and Japan, poultry consumption is anticipated to grow steadily, in line with long-term trends that favor affordable, versatile protein sources.

However, the global poultry trade will continue to face some level of volatility. The weakness in Chinese demand, for example, is putting downward pressure on prices for chicken feet, a popular product in the region. Geopolitical factors are also contributing to market uncertainty, particularly in the Middle East, where tensions have led to the rerouting of trade routes through South Africa. This rerouting has caused longer transport times and higher costs, which are impacting poultry trade between Asia and Europe.

Mulder notes that “animal diseases and geopolitical tensions will remain wild cards for the global poultry industry, as both factors can suddenly disrupt global trade flows.”

The Ongoing Threat of Animal Disease

One of the most persistent challenges for the global poultry industry is the threat of animal disease. In particular, avian influenza and Newcastle disease continue to pose risks to both producers and exporters. A recent outbreak of Newcastle disease at a farm in Rio Grande do Sul, Brazil, led to the imposition of export bans from key importers, including Japan, China, Saudi Arabia, and South Africa.

Although no new cases have been detected, the incident has raised concerns about the resilience of Brazil’s poultry sector, which is a major global supplier. Several countries have implemented regional restrictions or embargoes in response to the outbreak, highlighting the vulnerability of the global poultry trade to sudden disease outbreaks.

Despite these concerns, the overall pressure from avian influenza has been lower this year compared to previous years. The European Union, for example, recorded its lowest number of avian influenza outbreaks since July 2019. Similarly, South Africa has managed to keep its commercial chicken production free from outbreaks, allowing for a full recovery in chicken production, although egg production remains affected.

In contrast, the United States continues to face challenges, with ongoing avian influenza outbreaks during the summer months that have significantly impacted its egg industry. As winter approaches in the Northern Hemisphere, the risk of further outbreaks is expected to increase, presenting a potential obstacle for the poultry sector.

Key Risks: Feed Price Volatility and Geopolitical Tensions

In addition to the threat of animal disease, the global poultry industry faces other significant risks, including feed price volatility and geopolitical tensions. Feed prices have fluctuated over the past year, and continued price volatility could put pressure on production costs, especially for smaller producers. For many poultry farmers, managing these cost fluctuations while maintaining profitability will be a key challenge in 2024.

Geopolitical tensions, particularly in the Middle East, also pose a risk to global trade flows. As noted earlier, the rerouting of trade routes due to political instability is increasing transportation costs and creating longer lead times for poultry exports. These disruptions may slow the pace of trade between some regions and could affect overall profitability for poultry exporters.

Maintaining Supply Growth Discipline

In the face of these challenges, maintaining discipline in supply growth will be critical for poultry producers. Mulder emphasizes that in a context of high risks, producers must carefully manage supply growth to avoid overexpansion, which could lead to oversupply and falling prices, similar to what has occurred in China and Japan.

By exercising restraint in production expansion, poultry producers can ensure that the market remains balanced, thereby supporting continued profitability. This cautious approach is particularly important given the ongoing risks from animal disease, feed price volatility, and geopolitical tensions.

Conclusion

The global poultry market is poised for growth in 2024, with consumption levels expected to rise significantly, supported by strong retail demand, recovering foodservice sectors, and growing sustainability efforts. While most regions are experiencing bullish market conditions, challenges persist in China and Japan due to local oversupply and economic difficulties.

Global poultry trade is forecast to remain robust, but risks such as animal disease, feed price volatility, and geopolitical tensions continue to loom large. For poultry producers, maintaining disciplined supply growth will be crucial to navigating these risks and ensuring that the current positive market conditions are sustained in the long term. By doing so, the global poultry sector can continue to capitalize on rising demand and position itself for future success.