NEW YORK – The poultry industry is on track to deliver a strong performance in 2014, according to a new report from Rabobank.

Tight supplies of beef and pork coupled with lower costs for corn and soybean lifted margins for poultry producers in the third quarter of 2013. Those favorable market conditions are expected to carry over into the New Year.

"Global poultry fundamentals for 2014 look positive, with cost relief coming from lower feed costs, high prices of competing proteins and recently improved export volumes, but supply growth discipline will be the key element between profitable and not-profitable industries under these bullish market fundamentals," said Nan-Dirk Mulder, Rabobank analyst.

Western Hemisphere poultry producers outperformed their counterparts in the Eastern Hemisphere on profit margin for the third quarter and for most of the year, bucking a five-year trend, Rabobank noted. The robust profitability of the poultry industry in the Americas is expected to continue into 2014, while growth in Europe is projected at 0.6 percent.

Russia's poultry industry is improving after a challenging year, Rabobank said. Russia will benefit from government prices supports, while South Africa's poultry industry will enjoy new protections from Brazilian imports.

But the road ahead won't be without challenges, Rabobank reported. Animal disease and food safety will continue to be major issues in the New Year. China's recovery from H7N9 outbreak is ongoing, while Mexico's poultry industry is rebuilding its domestic supply under the lingering risk that the bird flu will reappear during winter.

"Despite the broadly positive global outlook, the challenge remains to keep markets balanced" Nan-Dirk Mulder said. "Key Asian markets of China and India are in the midst of a supply glut because of weak demand following food safety and animal disease issues (China) and slower economic growth (India). Early indicators for 2014 reflect better conditions for both markets as supply levels tighten, but in the case of Thailand, a big concern will once more be oversupply."