Rabobank: Solid global chicken demand, rising geopolitical risks and volatility
Asia Pacific and Southern Asia continue to drive expansion, while Europe is seeing its highest consumption increase in many years (around 3%-4%). Demand is supported by poultry’s price-competitive position, improved availability due to new greenfield investments, favorable economic conditions, cultural preferences, and ongoing product and market development.
The best-performing regions include Europe, Southeastern and Southern Asia, and South Africa, while the US, Mexico, and Brazil struggle with oversupply and low prices, highlighting the need for stronger supply discipline.
Global trade growth remains limited (1-1.5%), as many countries – including MEA markets, China, and parts of Asia – prioritize local production, while issues such as US reciprocal tariffs and Turkey’s temporary export ban add volatility.
The largest uncertainty is the conflict in the Middle East, which could disrupt the global economy (especially Asia Pacific due to oil dependency), raise feed prices via fertilizer costs and trade disruptions, and affect poultry trade, as the Middle East is a key import market for Brazil, the EU, Ukraine, and Russia.
Another great risk lies in food security for Gulf nations reliant on imports that pass through the Strait of Hormuz, which impacts chicken imports for Gulf region consumption and the trade of inputs for local production, like feed and genetics. Alternative routes or guided marine travel might become crucial to secure local food security if disruption persists.
Operationally, avian influenza remains the most significant biological risk, with major outbreaks continuing in Northern Hemisphere countries and risks gradually shifting south. Feed prices are expected to stay relatively stable, though the Iran conflict and uncertain Chinese corn and soybean purchases from the US introduce upward volatility risks.
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