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Poultry meat market: whose is the future?

10 ноя 2014г.

Nowadays poultry-breeding remains one of the most fast-developing sectors of animal-breeding despite the worlwide trends of slowing of the growth rates. At the same time, demand for poultry continues to grow mostly due to the developing' countries market, China and India most of all.

Experts explain such trends by the population growth and the increase in living standards. Besides, in the last few years we can see the trend of moving the consumers' preferences from beef and pork to poultry, as it is considered by people as better for health, as it contains less fat.

In the first half of 2014, about 1,891 thousand tons of poultry meat and by-products were produced in Russia, which is 8.55% more than the similar last-year period. According to the forecasts by Credinform experts, we can expect the increase in poultry meat and by-products production volume to the end of 2014 by 14.8% compared to 2013. Together with this, analysts note that Russian poultry market is far from being fulfilled: its consumption per capita is only 29.3 kilos. To put this in perspective, in the USA in Brazil this value is more than 45 kilos.

Among the negative factors that influence the world poultry market, experts notice the bird flu which continues to spread in several Asian countries, and also the growing costs for feed. Last year, prices for feed beat all the records. The price maximum was seen last June, when the average price has risen 146% as compared to June 2012. Such a huge price increase in the feed base was the result of the 2012 draught. Luckily, this year there were no problems with harvest, and feed prices continue to fall in comparison to last year.

According to the data by Credinform experts, a 3.45% decrease in natural terms in meat and meat by-products imports was seen by the end of 2013. At the same time, imports volume in Q1 2014 were 60,179 tons.

USA became the main poultry importer to Russia in Q1 2014, in money terms they hold more than one-third of imports, or 39.62%, and almost a half, or 49.99%, in natural terms. Last year, 300,185 tons of poultry meat and by-products for 1,251 million rubles (rate to the end of Q1 2014) were imported to Russia to the USA.

Among the large importers, we can also note Germany (17.80 and 13.06% correspondingly in money and natural terms), Brazil (14.15 and 7.11%) and Netherlands (6.32 и 7.79%).

The decrease in imports last year went together with the increase in exports. Thus, by the end of 2013, the volume of poultry meat and by-products exports from Russia has grown by 59.2% in natural terms. So we can say that Russia's entering the WTO had no negative impact on national manufacturers, even being an excellent stimulus for increasing production volumes and its optimization.

By the end of Q1 2014, the volume of poultry meat and by-products exports from Russia has reached 7,751 tons.  Hong Kong (Xianggang) has become the biggest importer of Russian poultry with more than half of all exports both in money (66.5%) and in natural (78.74%) terms. In Q1, 6,103 tons of production were brought to Hong Kong from Russia.

Among the biggest Russian exporters of poultry meat and by-products, there are Resouce-Yug Ltd, Bereg Ltd, Prioskolye Trade House CJSC, Baltiyskiy Tandem Ltd and Petelino Trade House LLC.

It's worth noticing that there are 1,891 poultry-breeding organizations registered in Russia. The top ten biggest Russian poultry-breeding organizations by volume for 2012 is presented in the table.

According to the value by Credinform due to the recent data presented in the Statistics Registry (2012) such companies as Stavropol Broiler CJSC, Novo-Yezdotskaya Poultry Factory Ltd and Inzhavinskaya Poultry Factory CJSC have the negative growth of net profit even though the sales volume growth was significant. Such a result can sign to the grown costs due to the rise in feed prices last year.

The volume of Russian poultry market (taking into count the external trade) for April 2014 is 111,831 million rubles. At the same time, experts think that this branch of animal-breeding is the most prospective. Thus, Russian Meat Union representatives value that poulty meat consumption in Rrussia will grow twice by 2020  and will reach more than a half of all consumed meat.

Among the most prospective branches of Russian poultry meat market, experts note the turkey market. Today, about 40 investment projects of turkey-breeding farms in 27 regions of the country are on different stages of realization.

At the sime time, industry specialists sign that poultry-breeding organizations need state support by the full subsidization of interest rates for short-time credits and grain dotations for increasing the existing results. Also,

In turn, manufacturers try to solve the existing problem of low manufacturing profitabily. Nowadays, more and more full-cycle enterprises are being opened, so their own systems of production sales and the feed base begin to work. Experts think that such companies have the future.


Author: Oxana Andreychenko,
Credinform IA analytic group expert
IV Международная Конференция
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