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The poultry industry should prepare for a tough year

After the big disruption caused by Covid-19 in 2020, the poultry industry will face additional challenges in 2021, especially in 1H. Covid-19 will place ongoing pressure on foodservice and trade, and the consequent slow economic growth will lead to more price-driven market conditions. As market fundamentals appear challenging for 2021, the poultry industry should prepare for a tough year.

Report summary

“Looking forward, we see four main challenges for the global poultry industry: ongoing Covid-19 impacts on markets, high and volatile feed prices, China’s African swine fever recovery, and the northern hemisphere avian influenza crisis,” according to Nan-Dirk Mulder, Senior Analyst – Animal Protein.

The disruptive factors affecting global poultry markets in 2021 will require traders to refocus. Falling demand in China and Vietnam will push traders to find other markets, which will depress global markets in 1H. In 2H, stronger control over the spread of Covid-19 should lead to a gradual recovery of foodservice markets. This will greatly help global traders. But before recovery takes place, big stock levels need to be unwound.

The ongoing tough economic conditions will challenge all poultry companies and will require a very disciplined supply strategy and a strong focus on procurement and cost control.

Source : Rabobank

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