September 9, 2003



EU Chicken Production Returning To Normal


EU chicken production is returning to normal following outbreaks of avian influenza while turkey production remains stable, according to information from the U.S. Department of Agriculture's Foreign Agricultural Service web site, dated Sept. 3 and released Monday.


The overall EU poultry market is stable, yet returning to normal as the Dutch, Belgian and German markets recover from the avian influenza outbreaks. Export refunds were introduced for turkey poults to all destinations except the USA and Estonia. There was not change to export refunds for poultry meat.


Despite recovery in EU markets from avian influenza, the EU poultry sector could experience significant changes in the coming years from various market forces. First, farmers' react to the Midterm Review as they make projections and plan for the 2004-2005-market year. Second, EU farmers will have to find ways to compensate for the January 2003 announcement by Russia of its tariff rate quota, which is expected to limit imports of beef, pork and poultry. Third, this summer's heat wave. The EU does not currently have statistics on the effects the drought has had on the poultry sector. And finally the imminent accession of 10 new member states in 2004, which means that previous extra-EU trade figures will become intra-EU trade figures.




EU chicken production in 2002 & 2003 is expected to return to normal levels by 2004, as poultry production in the Netherlands returns to normal levels following the Avian Influenza outbreak.


Increases in EU chicken production are also expected in Spain, Portugal and Germany, which is should offset the predicted decrease in poultry production in France, the press release said.


EU chicken import figures remain unchanged from previous 2002 estimates, however 2003 estimates indicate a decline in EU imports. In August of this year the EU will close a loophole, which previously allowed large quantities of salted meat from Brazil and Thailand to enter the EU market. The closing of this loophole effect overall EU import figures. The declining import trend is expected to continue through 2004.


In 2003 overall EU exports are expected to decline, as French exports to the Middle East remain stable. German exports remain stable and the Netherlands has virtually no exports to third countries in 2003. These overall decreases in exports are not expected to be offset by a marginal increase in exports from Spain.


EU domestic use in 2003 is expected to decrease in line with decreases in consumption. Part of the decrease in overall EU domestic consumption can be attributed to low production levels, which was the case in France. Commercial stocks in France were reduced, reflecting a depletion of commercial stocks, explaining the large disappearance in commercial stocks in France.


Germany on the other hand shows a marginal increase in domestic consumption due mainly to population growth and because chicken remains an easy to cook and healthy option.




Forty percent of EU turkey production takes place in France, although Italy and Germany are also large producers. EU turkey production in 2002 has been has been adjusted downward from previous 2002 estimates. In 2003 EU production will show an overall decline as France, the UK, Italy, and the Netherlands all show declines in production. Additionally, in France the French Turkey Producer's Organization (CIDEF), imposed a mandatory destruction of turkey eggs to prevent overproduction. As the lack of demand is forecast to continue into 2004 EU turkey production is expected to decline.


EU imports in 2002 have been adjusted upward from previous estimates mainly because of increased turkey consumption in the Netherlands.


Additionally, large quantities of imports of salted meat entering the EU, 30% of which are turkey attributed to the increase. In 2003 into 2004 EU turkey imports are forecast to be stable. Some salted turkey is expected to enter Germany.


Overall, in 2003 into 2004 overall EU exports are expected to continue the downward trend.


EU poultry exports are also hurt by the strong Euro.


Domestic Use in 2002 shows an overall increase in commercial stocks, which hides the increase in actual domestic use. In 2003 into 2004 total use is expected to be down from previous levels indicating a decrease in consumption as well as a decrease in ending commercial stocks.


Source: USDA
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