March 29, 2013

Lower pork prices in China affect poultry demand

Demand for Chinese broiler products has reduced due to lower pork prices and food safety concerns over chemical residues.

According to GAIN's Poultry and Products Semi-annual report, China's broiler production is forecast to fall by 50,000 tonnes to slightly over 14 million tonnes. Broiler meat imports are forecast at 270,000 tonnes to meet rising import demand by the processing sector for poultry products. The US export price remains competitive compared to those of major competitors, Brazil and Argentina.

Pork accounts for 60% of China's meat protein consumption. In general, poultry is substituted as a meat protein when pork prices reach high levels. On the contrary, when those prices are affordable, consumers prefer to purchase pork products. In August 2012, the retail pork price fell by 24% to CNY22.94 (US$3.65) per kilogramme.

On February 18 2013, China's General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) and the Ministry of Agriculture (MOA) suspended poultry imports from the State of New York due to an outbreak of low pathogenic avian influenza (LPAI). Traders note that this suspension is not expected to impact US poultry exports to China.