October 31, 2008
 
Thai Broiler Weekly: High pork prices drive chicken demand (week ended Oct 30, 2008)           
 
An eFeedLink Exclusive                                                    
 
 
Price summary
 
After weeks of slow decline, the price of live broilers has stabilised at THB29-30/kg as consumers started switching to chicken owing to high pork prices.
 
While the farm price of chicken plummeted to THB23/kg last month, the price of live pig had shot up from THB53 last month to THB56-57 early this week. This has, however, gone down to THB55-56 mid this week after hog raisers voluntarily offered to cut their prices by THB1/kg to spur demand.
 
At public markets, pork sells at THB105-110/kg while dressed chicken is at THB60-66/kg.
 
 
Market analysis
 
Chicken prices have been falling consistently since May because of overproduction, currently estimated at 18-19 million chickens from 15 million a week at the start of the year.
 
The Thai swine sector had the same oversupply problem at the start of this year. But unlike the broiler industry, the pork industry has addressed the problem by scaling down production by up to 13 percent to drive up pork prices.
 
Complicating the poultry sector's problem is the ongoing global economic slowdown, expected to stunt this year's export growth estimate of 9-10 percent. During the first half of the year, processed chicken export grew by 8-9 percent because of increased demand from the EU and Japan. But the government has recently warned that import orders from these countries could fall from now until next year because of an expected global recession.
 
Worse, local demand has also been sluggish because of an economic slowdown triggered by the country's prolonged political crisis. Fortunately, this week's 5 percent fall in feed prices has helped farmers cushion the impact of the broiler price depression.
 
Under pressure from the government, local feedmill operators have agreed to slash feed prices because of steep declines in the prices of corn and soy, the major feed ingredients.
 
This week, corn prices dropped to THB7.58-7.72/kg from a high of THB12/kg at the height of the oil and food crisis mid this year.
 

Markets

Prices
for whole dressed chicken

as of 
Oct 23
(in Thai baht/kg)

Prices
for whole dressed chicken

as of  Oct 30
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Supermarkets (Bangkok)

64-66

64-66

0

Public markets (Bangkok)

58-60

58-60

0

Public markets (Suburbs)

55-58

55-58

0

Farm gate 

29-30 (liveweight)

29-30 (liveweight)

0

US$1=THB 35.005 (Oct 31)


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