Rabobank: Avian influenza poses threat to global poultry trade

by Joel Crews
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Culling of birds in affected countries is being used to mitigate the threat and avoid a repeat of 2015. 
 

ST. LOUIS – In its latest poultry industry report, the Rabobank International Food & Agribusiness Research and Advisory’s Q4 Poultry Quarterly report signalled challenges to an otherwise positive global poultry outlook in the year, due to global reports of avian influenza (AI) outbreaks reminiscent of  similar incidents in 2015.

Trade of meat and breeding stock are at risk during a period when tailwinds for poultry were resulting in  positive momentum at a time when seasonal vulnerability for AI outbreaks are more likely given the onset of the winter season.                

This past month, discoveries of the highly pathogenic H5N8 virus have been reported in eight European Union countries, resulting in the cull of tens of thousands of birds to contain the outbreak in addition to hundreds of thousands of ducks in Japan being culled as a containment measure.

Up until recently, the Rabobank report points out the positive results enjoyed by the poultry industry were strong enough to stay competitive with competitive red meat pricing, which have been trending lower in most global markets. The hopes are to stave off the negative impact to ensure the positivity continues into 2017.

As global trade becomes increasingly unsettled and uncertain, “it will also be a test for the US industry,” according to Rabobank, “after last year’s multiple AI outbreaks,” pointing out that exports of meat and breeding stock from partners in Asia and Europe will likely create volatility in this trading segment as before.

With exports to China and Hong Kong forecast to maintain at a high level in light of the supply shortage, a positive for countries exporting product there is due in large part to an especially high demand for wings and feet, bringing a premium. Overall global volume could be challenged by trade protectionism, as improved relations between the US and Russia could be beneficial, but threats to trade agreements including TTP stand to put a damper on future prospects.  

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