May 5, 2004

 

 

China's Domestic Demand and Export of Poultry Meat Seen to Rise in 2nd Quarter

An Analysis of China's Poultry Meat Market in 1st Quarter 2004

 

An eFeedLink Exclusive Report
               

China's poultry inventory and slaughtered poultry have fallen drastically in the 1st quarter of 2004. Compared to the same period last year, prices of day-old-chick broiler have dropped, while prices for broiler complete feed registered a big jump.

 

From January to February 2004, prices for slaughtered chicken and live chicken have generally gone down. The imports and exports of poultry products have dropped during the first quarter; however, the trade volume was maintained at a favorable balance.

 

1.  Poultry Production Analysis

 

During the first quarter of 2004, due to the bird flu outbreak in some parts of China and its neighboring countries, China's poultry inventory and slaughtered poultry were on a downward trend, with prices of day-old-chick falling substantially.

 

In Guangdong and Shandong provinces, price of day-old-chick have dropped from RMB 1.5-1.6 per chick to RMB 0.1-0.2 per chick. During the first quarter, poultry breeders in Tianjin have dropped by 23%, while the volume of poultry entering the market in Zhejiang province have fallen by 30%.

 

2.  Drop in Imports & Exports of Poultry Products

 

Between January and February 2004, China's export value of poultry products amounted to US$83.84 million, while that for import stood at US$62.48 million, down by 33.49% and 3.06% respectively compared to the same period last year. The net export value was US$21.36million.

 

2.1  Drop in Imports and Exports of Poultry Meat and Entrails

 

China has exported 27,500 tons, worth US$34.50 million, of poultry meat and entrails during the first quarter of 2004. This represents a year-on-year decrease of 33.57% and accounts for 41.14% of the total export of poultry products.

 

China imported 76,900 tons, worth US$61.80 million, of poultry meat and entrails during the first quarter. This shows a year-on-year decrease of 11.64% and 2.90% respectively.

 

2.2  Fall in Exports of Processed Poultry

 

During the first quarter, China's export of processed poultry totaled 13,900 tons, worth US$39.98 million, registering a year-on-year decrease of 40.29% and 36.90% respectively.

    

Processed poultry is mainly exported to Japan, Hong Kong, South Korea, Singapore and USA. The export value to these countries is at US$39.54million, constituting 98.91% of the total export.  The export to Japan, Hong Kong and Singapore dropped by 37.95%, 35% and 13.34% respectively compared to the same period last year.

     

China's top 10 provinces and cities, which export processed poultry, are Shandong, Beijing, Liaoning, Shanghai, Hebei, Guangdong, Jiangsu, Tianjin, Jilin and Heilongjiang. The export value of these 10 provinces in the first quarter amounted to US$39.74 million, making up 99.40% of China's total export of processed poultry.

 

China imported very little processed poultry in the first quarter, with imported products mainly going to Jiangsu and Guangdong provinces, making up 86.61% of the total import value.

 

3.  Analysis of Poultry Prices in China

 

3.1  Price Analysis of Poultry Meat

 

Between January and February 2004, prices of slaughtered chicken and live chicken have dropped in most parts of China; however, prices have slowly recovered in March.

 

3.2  Prices of Slaughtered Chicken

 

Except in a few isolated provinces, prices of slaughtered chicken in most provinces of China have dropped due to the impact of the bird flu outbreak. Prices of slaughtered chicken were at RMB 9.59/kg in the first quarter, showing a decrease of 1.74% over the last quarter.

 

3.3  Prices of Live Chicken

 

Average price of live chicken was RMB 9.62/kg for the first quarter of 2004. Since the end of January, prices of live chicken have begun to drop, with significant decline registered in both the major chicken producing and buying regions. Compared to January, prices of live chicken fell by 20.1%, 27.4% and 36.6% in Jiangsu, Guangdong and Tianjin respectively in February. However, prices started to recover in March.

 

3.4  Price Analysis of Day-Old-Chick Broiler

 

Affected by the bird flu outbreak, prices of day-old-chick broiler have fluctuated significantly in the first quarter of 2004. Between January and March, prices of day-old-chick broiler dropped by 5.17% versus the same period last year. In February, prices fell to its lowest over the last 5 years; however, they started to recover in March.

 

Average price of day-old-chick broiler in major producing regions for the first quarter has registered a decrease of 3.52% over the same quarter last year, of which, Guangdong and Jiangsu showed a fall of 9.03% and 0.64% respectively.

 

4.  Price Analysis of Complete Feed for Broiler

 

Average price of broiler complete feed was RMB 2.04/kg in the first quarter of 2004, showing a year-on-year increase of 12.32% increase, of which, Jiangsu, Shandong and Sichuan provinces registered a rise of 21.35%, 18.1% and 14.3% respectively.

 

5.  China's Poultry Meat Market Outlook for the 2nd Quarter of 2004

 

In the second quarter of 2004, China's poultry meat production is expected to recover gradually, with prices of day-old-chick broiler seen rising. The demand for poultry meat in the Chinese domestic market will increase, while the export of poultry meat will also improve during the second quarter. With the rise in prices of raw materials for feed production and feed products, the production cost of poultry meat will increase in tandem. This will undoubtedly jack up market prices of poultry meat.