September 3, 2004

Russian 2005 Poultry Production Expected To Expand

Russian poultry production is forecast to expand for an eighth straight year in 2005, as broiler production grows by 13%, according to information from the U.S. Department of Agriculture's Foreign Agricultural Service web site, dated Aug. 17 and released Wednesday.
 
Russian poultry production is forecast to expand for an eighth straight year in 2005, as broiler production increases by 13%. Broiler production is forecast at 705,000 metric tons in 2005, 3.5 times higher than 1997.
 
Russian broiler production is forecast to grow by 13% in 2005, following similar growth in 2004. Continued investment into the sector, mainly in renovating existing facilities, will drive growth in the medium term. Though direct competition with imports is limited, domestic producers are making significant profits due to the overall higher prices on the Russian market resulting from the quota. The production estimate for 2004 was revised upward slightly as producers continued to expand despite high feed prices in 2003/04.
 
Higher Russian feed grain production is expected to increase feed available for poultry production and reduce prices beginning this fall.
 
Turkey production in Russia is also forecast to grow by 13% in 2005. The previous estimate for 2004 was revised upward by 25% due to the opening of a new production facility.
 
According to official Russian statistics, total poultry production (including broilers, spent hens, turkey, and other fowl) is expected to be approximately 900,000 MT, after a decline in the non-broiler production.
 
While the import quota has only been in place for two of the last eight years, the higher prices paid by consumers have supported greater investment in production facilities. The poultry import quota and its poor implementation are playing a big role in 2004 by pushing prices significantly higher and restricting imports to about 70% of the quota level.
 
Poultry consumption is expected to fall by six percent in 2004 due to the quota problems, then to remain flat in 2005 as Russia's import substitution policy negatively affects consumer purchasing power.