June 27, 2014

According to Rabobank's quarterly report, global poultry prices are increasing in Q2, which is expected to improve the profitability for the poultry industry.

This increase is partly driven by high beef and pork prices, along with recovering demand and a more balanced supply and demand situation in most regions.

Rabobank analyst Nan-Dirk Mulder said, "Under improved global market conditions, led by the North American region, a slight increase in global chicken prices is expected."

"We see an increasingly balanced market, where supply discipline is more the order of the day and improving margins will be the likely result. However, markets remain volatile and any change in fundamentals, especially from the supply and feed side, will impact global prices. Suppliers should look to keep production growth disciplined," he commented.

Based on the optimistic outlook for wheat and soybean crops, global feed prices are expected to fall in Q3 and Q4. However, the possible volatility in feed prices remains a threat. In addition, the turmoil in Ukraine and the threat of El Nino are posing challenges to the industry.