November 13, 2007

High broiler meat prices for Japan until 2008

High prices of broiler meat, partly due to increased feed prices are seen to continue in Japan until 2008, according to the US Department of Agriculture (USDA).

The USDA reports that though imports of generic cuts, mainly from Brazil and the United States, are expected to bounce back, the increase is expected to remain modest, hampered by high prices. Imports of cooked products, mainly from Thailand and China, are expected to decline further. Lacklustre demand for Chinese cooked poultry products is forecast in 2008, due in part to China's negative food safety image. Japan is not expected to lift its avian influenza-related bans on uncooked poultry from China and Thailand in 2008. 

Due to high feeding cost, the USDA projects slightly lower domestic broiler output in 2008 by 1 percent to 1.225 million tonnes. Also, continual high prices for the domestic broiler cuts may cause a consumption shift to competitively priced imports in 2008. Meanwhile, high feed cost, high fuel and, high utility prices will put pressure on domestic producers to curb production in 2008.

The Japanese broiler market will likely continue to experience tight supply and solid demand in 2008 for both frozen and cooked products, according to the USDA.

Both Japanese importers and domestic producers are increasingly concerned about the world supply outlook and the price expectations for feed in 2008. Many traders consider it likely that high feed costs will keep broiler meat prices high in 2008. The relatively solid demand for broiler meat reported in EU, the Middle East and in China since 2007 also points to continued strong prices in Japan.

For more of the USDA report, please click here.