May 16, 2024

How China's volume of grandparent and parent stock broiler breeders are affecting prices

 

China's total broiler release volume (including white feather, yellow feather and small white feather broiler chickens) in 2023 was 13.022 billion birds, an increase of 1.165 billion birds from 2022.

The sales volume of white feather broilers reached a record of 7.195 billion birds.

Following a price increase in the first quarter of 2023, the prices of white-feather broilers fell sharply since the second quarter. The rise in broiler prices in the first quarter was closely related to the low quantity of grandparent stock (GPS) white feather broiler breeders in 2022, in addition to the low seasonal slaughter volume at the start of the year.

In 2022, China's replacement volume of GPS white feather broiler breeders shrunk with a year-on-year decrease of 34.17%. This led to the rapid rise in the prices of parent stock (PS) white feather broiler breeders and commercial grade broiler chicks in early 2023, eventually lifting the prices of white feather broiler chickens.

Last year, China imported 409,6000 sets of GPS white feather broiler breeders. It also produced 8.703 million sets of GPS breeder broilers, accounting for more than two-thirds of the Chinese market. In total, China replaced 1,279,900 sets of GPS white feather broiler breeders in 2023, an increase of 32.85% compared with 2022.

The gradual increase in the number of GPS white feather broiler breeders in 2022 resulted in a rise in the number of PS white feather broilers in 2023, eventually exceeding 2022's level. One reason for this trend is the price of PS white feather broiler breeders which spiked following the reduction in the replacement volume of GPS breeders in 2022; as the cost of PS breeders increased, companies that produce PS broiler breeders delayed discarding unproductive breeders, leading to a higher inventory of PS breeders in 2023.

But, as the volume of PS broiler breeders was in excess last year, this will lead to an oversupply of commercial-grade white feather broiler chicks in 2024, particularly in the first half of the year. This means the price of white feather broilers will remain low level at least during the first half.

Prices will only pick up in the second half of 2024 — most likely in Q4 after chick supplies diminish substantially.

- Shi Tao, eFeedLink