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  • Unconventional Ag

Rabobank: Bird Flu Impacts Global Poultry Sector

New avian flu (AI) outbreaks reported in the U.S. in Missouri, Minnesota, Arkansas and California, and also in Taiwan, South Korea, India, and Vietnam have put pressure on the global poultry sector. This, combined with currency volatility and unrest in the Middle East and Eastern Europe, could affect global trade, lowering volumes and prices, according to the latest report from Rabobank. If the virus continues to spread across the central states of the U.S. and further through Europe to Hungary the risk could increase.

Despite this, Rabobank’s Food and Agribusiness Research team forecasts a positive outlook for the global sector based on steady demand in most regions, low feed costs, and high beef prices.

For the EU, supply is tight and export markets are closing due to ongoing issues with AI. However, the industry is showing signs of some recovery, as is the market in the U.S., for which Rabobank is expecting to see high margins for 2015.

China is seeing a scenario of oversupply as human AI cases have forced the shut-down of live bird markets during the country’s peak sales month.

Russia is expected to experience the continuation of tight market conditions as a result of its limiting imports which have created higher prices and the restricted growth in the industry.

Brazil’s poultry sector has had a strong start to the year, seeing strong margins supported by low feed costs. Lower oil prices have cooled demand from Middle Eastern markets, however, an increase in demand from Asia has compensated for the drop.

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