STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET

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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
2012

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                                               Introduction to the Executive Guide.............6
                                               WATT Executive Guide to World Poultry Trends
                                               offers an improved way to access additional data
                                               online.

                                               High feed costs impact poultry meat,
                                                egg production worldwide...........................8
                                               High input costs may limit market growth in
                                               developed countries.

                                               Global poultry and egg market
                                                projections ...................................................12
                                               Poultry and egg consumption, production
                                               changes as population grows over the next
                                               decade.

                                               Developing countries fuel poultry meat
                                                production growth ......................................18
                                               Population increases, rising costs lead to trade
                                               growth in poultry and egg products.

                                               China remains world’s top egg producer
                                                in 2012...........................................................24
                                               More than half of world’s total egg production
                                                    

                                               Poultry meat and egg trade in
                                                international markets .................................28
                                               High feed costs limit growth in many countries.

                                               World’s top poultry, egg companies ...........32
                                               Consolidation continues to be seen in two
                                               top chicken markets.

                                               Egg consumption growth driven by
                                                developing countries ..................................38
                                               Table egg consumption increases due to
                                               population growth, increased uptake of
                                               egg products.

  Cover photo: ©Mark Hryciw I Dreamstime.com

2 executive guide 2012
STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
WATT Executive Guide to World Poultry Trends
INTRO

         offers improved way to access additional data online

           To access the datasets, please sign in or sign up on
           www.WATTAgNet.com. Once logged in, you’ll be able
           to visit the Market Data section to access links to each
           dataset and download it in a spreadsheet format.

                                                                            Click on a tab in the Market Data section of WattAgNet to
                                                                            access a list of downloadable datasets and view charts.

         W
                      elcome to the latest edition of the      To access these datasets,
                      WATT Executive Guide to World              
                      Poultry Trends. This resource is        
         designed to help you stay up-to-date on the            
         major aspects of the poultry and egg industries         
         worldwide.                                         Executive Guide   
             Covering production, trade, consumption                                        Below the chart, click on
         and more for the global poultry meat and           — www.WATTAgNet.                                 “Download Excel file for more
         egg industries, the Executive Guide offers a       com/marketdata/executiveguide — to               data” to download the dataset
         unique source of data compiled in one place.           !    !       to your computer. You must
         Accompanying each report within the guide,         !  ! !  !               be registered and logged in to
         you will find charts on data and trends relating            !         download the datasets.
         to sectors, countries and world regions.           " !!   #  $   
             New for this year, we are pleased to offer     % ! &  
         an expanded Market Data section of www.               The Executive Guide               We have great pleasure in presenting the
         WATTAgNet.com, which has dedicated                          ! !           WATT Executive Guide to World Poultry
         areas for all the downloadable datasets for        !     !           Trends for 2012-13. We are confident that
         the guide, additional poultry data and Top            !'       '     it will be a valuable tool for your business
         Companies data.                                    ( ' )*                            throughout the coming year. EG

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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
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STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
SECTION ONE

         High feed costs impact poultry meat,
STATUS

         egg production worldwide
         High input costs may
         limit market growth                                       More data available in Market Data section of WATTAgNet
         in developed coun-                                        Sign in or sign up as a user on www.WATTAgNet.com to download these datasets as spreadsheets.
         tries.
            In 2012, global meat
         production is projected to        ➥World poultry meat production trend 1995-2012 –
         expand by nearly 2 percent           www.wattagnet.com/154342.html
         to 302 million metric tons,       ➥Largest egg producing countries in 2010 –
         according to estimates from          www.wattagnet.com/154312.html
         the Food and Agriculture
         Organization of the United        ➥World meat market production and trade estimates 2010-
         Nations. This growth                 12 – www.wattagnet.com/154424.html
         will be driven by gains in        ➥EU egg imports by product 2011-2012 –
         pig meat production and               www.wattagnet.com/154421.html
         poultry production, which
         for the first time in history     ➥Population growth rates by world region to 2021 –
         exceeded 100 million metric          www.wattagnet.com/154466.html
         tons, reaching a record
         101.6 million metric tons in
         2011, according to FAO (Figure 1). Overall, the meat market’s  India is expected to reach a record 3.2 million metric tons in
         growth will depend on feed prices and animal diseases. Much    2012 thanks to vertical integration among producers and an
         growth will come from developing countries in 2012, while      expanding middle-class population, according to estimates
         developed countries may see a second year of lower output      from the Foreign Agricultural Service/U.S. Department of
         and profitability with stagnating domestic meat consumption,   Agriculture. However, with a record seven Asian countries
         high input costs and competition from developing countries.    reporting outbreaks of Avian influenza in February 2012,
                                                                        production growth in this region will depend on these poultry
         Poultry meat production and consumption                        health concerns for the remainder of the year.
            Global poultry production is expected to increase 1.8          Global broiler meat production growth will remain
         percent by the end of 2012 to a projected 103.5 million metric suppressed and profitability will be a concern for producers
         tons (Table 1). Much of the growth in poultry production       also facing high feed prices and trade disputes. Projections
         will come from Asia, specifically, China, India, Japan, the    completed in April 2012 by the Foreign Agricultural Service/
         Republic of Korea and Turkey. Production of broiler meat in    USDA for broiler meat production in Brazil, the United States

         FIGURE 1: WORLD POULTRY MEAT PRODUCTION TREND 19952012
                                           120,000

                                           100,000
            poultry meat production (kt)

                                            80,000

                                            60,000

                                            40,000

                                            20,000

                                                0
                                                     1995 1996   1997 1998 1999 2000    2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
                                                                                                         year

  8 executive guide 2012
STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
TABLE 1: WORLD MEAT MARKET PRODUCTION AND TRADE ESTIMATES
                                     2010                2011 estimate                    2012 forecast            Change: 2012 over 2011
WORLD BALANCE                                    Production (million metric tons)                                             %
Total meat production               294.6                    297.2                             302                            1.6
Bovine meat                          67.5                     67.5                             67.5                             -
Poultry meat                         98.2                    101.6                           103.5                            1.8
Pig meat                            109.9                     109                             111.7                          2.6
Ovine meat                           13.5                     13.5                             13.6                           0.9
Trade                                26.6                     28.5                             29.2                          2.4
Bovine meat                           7.7                      7.8                              8.1                            4
Poultry meat                         11.6                     12.6                               13                           3.1
Pig meat                              6.2                      7.1                                7                          -0.7
Ovine meat                            0.8                      0.7                              0.7                           1.4
SUPPLY AND DEMAND INDICATORS
                                            Per capita food consumption (kg per year)
World                                42.5                     42.3                             42.5                          0.5
Developed                            79.2                     78.9                             78.4                          -0.5
Developing                           32.4                     32.3                             32.8                           1.5
FAO MEAT PRICE INDEX                2010                     2011                       2012 (January-April)   % change (January-April 2012 over
(2002-2004=100)                                                                                                      January-April 2011)
                                     152                      157                              179                           3.3
Source: FAO Food Outlook May 2012

                                                                                                                           executive guide 2012 9
STATISTICAL REFERENCE FOR POULTRY EXECUTIVES - THE 2012 - WATTAGNET
SECTION ONE

         FIGURE 2: EVOLUTION OF EGG PRICES IN THE EU                                                                           Rising domestic demand with an
STATUS

                                                                                                                               increasing population will continue
                        185                                                                                                    to raise imports in Africa, notably in
                                                                                                                               Egypt, a country also hit by the spread
                                                                                                                               of Avian influenza outbreaks in early
                        165                                                                                                    2012, as well as in Angola, Benin and
                                                                                                                               Ghana, where regional dependency on
                        145                                                                                                    imports is currently estimated at 24
           euro/100kg

                                                                                                                               percent of domestic consumption, up
                                                                                                                               from 18 percent in 2009.
                        125
                                                                                                                               Changes in egg production
                                                                                                                               in the EU
                        105                                                                                                       The year 2012 also brought about
                                                                                                                               changes in the egg market as a result of
                         85                                                                                                    the EU Animal Welfare Directive banning
                              1   4   7   10 13 16 19 22 25 28 31 34 37 40 43 46 49 52                                         conventional battery cages. On January
                                                                   week                                                        1, a 12-year transitional period expired
                                                                                                                               requiring that EU member states be fully
                          Avg 07-11        2009           2010 Avg             2011 cage only           2011         2012
                                                                                                                               compliant with the directive.
                                                                                                                                  As a result, European egg prices
                                                                                                                               spiked after the January 1 deadline
         and China were all lowered from                                  2012 when it joins, but progressively                (Figure 2). This was partially attributed
         earlier projections to 13.3 million tons,                        decline with increased domestic                      to a shortage of eggs as producers
         16.4 million tons and 13.7 million tons,                         production. EU poultry meat imports                  switched from using conventional
         respectively. Globally, broiler meat                             will also slow as the industry conforms              cages, as well as increased costs of
         production was revised downward by                               to the EU Animal Welfare Directive                   production in alternative housing
         881,000 from previous forecasts to                               banning the use of conventional battery              (Figure 3). Not only did the EU see a
         82.2 million tons.                                               cages in 2012.                                       spike in shell egg prices, but the price
            Despite trade disputes, poultry                                  Moreover, world meat consumption                  of eggs in the breaking market also
         meat trade is still forecast to rise                             continues to grow at one of the                      increased to nearly double what is
         by 3 percent to 13 million metric                                highest rates compared to other major                normal. EU egg prices have since been
         tons in 2012. World poultry import                               agricultural commodities, in spite of                steadying slightly and decreasing, said
         growth will be led by countries in the                           United Nations projections that world                Herman Versteijlen, director agricultural
         Middle East, Southeast Asia and Latin                            population growth will slow to an                    markets for the European Commission.
         America, according to FAO. After a                               average of 1.02 percent per year over                   Prices of eggs in China, the world’s
         World Trade Organization-induced                                 the next decade. Africa will experience              largest producer, have also been on the
         increase in the poultry tariff-rate quota,                       the fastest population growth at more                rise this year due to decreased output
         Russia’s poultry meat imports are                                than 2 percent per year, more than                   caused by weather and rising costs of feed
         expected to pick up slightly again in                            double any other region (Table 2).                   ingredients, among other factors. The

          TABLE 2: POPULATION GROWTH RATES BY WORLD REGION
                                                                                      Average annual growth rate %                      Number of additional people (millions)
                                                                          2002-11                                    2012-21                         2012-2021
          World                                                             1.17                                       1.02                             678
          Africa                                                            2.38                                       2.29                             233
          Latin America and Caribbean                                       1.19                                       0.97                               55
          North America                                                     0.92                                       0.82                              27
          Europe                                                            0.19                                       0.11                                7
          Asia and Pacific                                                   1.14                                       0.91                             345
          China                                                             0.52                                        0.3                              43
          India                                                             1.46                                        1.2                             160
          Oceania Developed                                                 1.56                                       1.16                                3
          Source: OECD-FAO Agricultural Outlook 2012-2021, UN World Population Prospects

 10 executive guide 2012
FIGURE 3: EU EGG PRICE 20062012                                                                                    2002 to nearly 25 percent in 2011.

                                                                                                                    Egg exports set records in
              200
                        2006            2007        2008        2009         2010        2011        2012           the US
              180                                                                                                      In the U.S., exports for table eggs and
              160                                                                                                   egg products set new records for volume
              140                                                                                                   and value in the first four months of 2012,
              120                                                                                                   according to Jim Sumner, president,
 euro/100kg

                                                                                                                    USA Poultry & Egg Export Council,
              100
                                                                                                                    which follows a record-setting 2011.
               80                                                                                                   An estimated 275 million dozen eggs
               60                                                                                                   were exported from the U.S. in 2011, 30
               40                                                                                                   percent more than the 10-year average for
                                                                                                                    annual U.S. exports. Hong Kong remains
               20
                                                                                                                    the largest market for U.S. egg exports,
                0                                                                                                   followed by Canada. Sumner said further
               Jan/06          Jan/07          Jan/08      Jan/09       Jan/10      Jan/11      Jan/12
                                                                                                                    opportunities for growth in the U.S. egg
                                                              year
                                                                                                                    export market exist in the EU, where
                                                                                                                    U.S. eggs can serve as a replacement
                                                                                                                    for eggs lost during the transition from
average price of whole eggs in China rose                            and fourth quarters of 2012, given price       conventional cages. Another potential
by 7.3 percent on August 11 from July 21,                            increases in agricultural products and fuel,   market of growth for U.S. eggs is India,
which is also fueling inflation concerns                             China Merchants Securities estimates.          where domestic production will be unable
in that country, where the consumer price                               In Australia, consumer demand for           to keep up with consumption as the
index hit a 30-month low in July. Inflation                          free-range eggs as opposed to cage eggs        population grows at a projected annual
is expected to remain at 1.9 percent and                             has picked up, where the market share          growth rate of 1.2 percent from 2012 to
2.5 percent, respectively, in the third                              has increased from about 8 percent in          2021. EG

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                                                                                                                                             executive guide 2012 11
SECTION 2

           Global poultry and egg market projections
FORECAST

           Poultry and egg consumption, production changes as population
           grows over the next decade.

                                                                 FIGURE 2: POPULATION GROWTH TO 2050 IN DEVELOPED AND
                                                                 DEVELOPING COUNTRIES

           I
               n the year 2021, world poultry                                                  10
               meat production is projected to                                                                                    World population 2050
                                                                                                                                  9.5 billion
               reach 127.2 million metric tons.                                                 8
           Although the world’s population
                                                                      population in billions

                                                                                                                     World population 2010                                            Rest of world
           growth rate is expected to slow to just                                                                   6.8 billion                                                      5.3 billion
           1.02 percent per year over the next                                                  6
           decade (Figure 1), nearly 680 million
           additional people will need food, fiber                                               4                                                                                     India
           and fuel by 2021.                                                                                                                                                          1.8 billion
                                                                                                                                                                                   China
                                                                                                2
           World population                                                                                                                                                        1.4 billion
           growth slows                                                                                                                                                            Developed
              In 2030, the world will                       0                                                                                                                      countries
           have an estimated 8.3 billion                         1800                  1850                    1900                  1950                   2000              2050 1 billion
           people, and in 2050, the world
           will be home to 9.3 billion
                                                     Source: United Nations Population Reference Bureau (from “The Challenge of our Times: Why Feeding the World will Require Finding the Optimal Combination
           people. This means that a
                                                     of Natural and Human Resources,” by Carl Hausmann, managing director, Bunge Ltd.)
           70 percent increase in food
           production will be necessary
           between now and 2050 in order to keep up with the growing                                     of the United Nations and the Organisation for Economic
           global population, according to a presentation given by Carl                                  Co-operation and Development based the projections on a
           Hausmann, managing director at Bunge Ltd.                                                     series of assumptions. Some of these assumptions included
              In preparing the latest “Agricultural Outlook” publication                                 the eventual containment of the sovereign debt and banking-
           on global projections for the agriculture and food sectors from                               sector problems in the Euro zone that are currently slowing
           2012 through 2021, the Food and Agriculture Organization                                      economic growth, as well as high energy and oil prices.
                                                                                                                                                            The nominal crude oil price is
           FIGURE 1: POPULATION GROWTH RATE PERCENTAGES BY                                                                                                  expected to be higher than in the
           WORLD REGION                                                                                                                                     past on account of higher crop
                                                                                                                                                            costs, increasing at an average
                                                                                                                   Middle Africa                            annual growth rate of 2.9
                 2.5
                                                                                                                     East                                   percent, from $111 per barrel in
                                                             Developing                                                                                     2011 to $142 per barrel in 2021.
                 2.0                                                                               Latin
                                                                countries                                                                                         The greatest population
                                                                                                 America
              average annual percent

                                                                                    Asia                                                                    growth          will be in developing
                 1.5 World       United
                                 States                                                                                                                     countries           (Figure 2). Developing
                                                                                                                                                            countries will contain about
                 1.0                    Developed                                                                                                           6.9 billion people by 2030, and
                                        countries
                                                                                                                                                            will account for 85 percent of
                 0.5                               Former
                                                   Soviet                                                                                                   the global population in 2050.
                                                    Union                                                                                                   Thus, these countries will make
                 0.0                                                                                                                                        up much of the demand growth
                           1991-2000        2001-2010               2010-2021                                                                               for poultry meat and eggs during
                -0.5                                                                                                                                        that time.

 12 executive guide 2012
Among OECD countries, Turkey is expected to have the                                 FIGURE 4: WORLD MEAT MARKET SHARES IN 2021
highest growth rate over the next 10 years, at more than
4 percent per year. Brazil, Russia, India and China are all                                   Production by type of meat
expected to continue growing over the next ten years at about
8 percent per year.

Egg consumption on the rise in developing                                                 Sheep 16
                                                                                          (x 1 million metric tons)                              Poultry 127
countries                                                                                                                     (x 1 million metric tons)
   Projections from FAO suggest that global egg consumption
will rise from 6.5 kg per person per year in 1997/99 to 8.9
kg per person per year in 2030 in developing countries. In
industrial countries, egg consumption is projected to rise from
13.5 kg per person per year in 1997/99 to 13.8 kg per person                                                               Pork 126
per year in 2030.                                                       Beef/veal 77                                       (x 1 million metric tons)
   More than 67 percent of demand for eggs by 2015 will                 (x 1 million metric tons)
come from Asia, according to Professor Hans-Wilhelm
Windhorst. In China, where egg consumption is more
than double the average for developing countries, a rise in
                                                                         Source: OECD-FAO Agricultural Outlook 2021
consumption from 15 kg per person per year in 1997/99 to 20
kg per person per year in 2030 is likely based on FAO data.
   Additional data from FAO suggest
that the world’s production of eggs
                                           TABLE 1: WORLD MEAT PRODUCTION PROJECTION TO 2021
will reach 70.4 million metric tons in
                                                              World region                                                                        % growth
2015 and 89.9 million metric tons in
                                                    Meat         type                  2009-11                      2021    Amount increase       2012-2021
2030, at a growth rate of 1.6 percent
per year from 2015 through 2030. Of        Poultry meat (Kt)   Developed                40,595                      47,438         6,843              1.36
this global total, developing countries                        Developing               58,075                      79,763        21,688              2.75
will produce 50.7 million metric tons      Pork (Kt)           Developed                 41,417                     45,189         3,772              0.73
of eggs in 2015 and 69 million metric                          Developing                67,214                     81,053        13,839              1.73
tons of eggs in 2030.                      Beef/veal (Kt)      Developed                29,726                     32,396          2,670              1.45
                                                                                Developing               35,905                 44,107                 8,202            2.02
Shifts in the makeup of
global meat markets                                 Sheep meat (Kt)             Developed                  3,115                 3,462                  347              1.2
   Globally, meat production is also                                            Developing                9,996                 12,397                 2,401            1.97
expected to slow from previous                      All meats (Kt)              Developed               114,853                128,485                13,632            4.74
growth rates over the next decade                                               Developing              171,190                217,320                46,130            8.47
(Table 1). FAO projects world meet                  (Poultry meat is expressed as ready-to-cook equivalent weight, pork and beef/veal as carcass-weight equivalent)
production will slow from an average                Source: OECD-FAO Agricultural Outlook 2021
growth rate of 2.2 percent per year in

FIGURE 3: PRODUCTION GROWTH BY MEAT TYPE 19952021
                  140

                  120

                  100          Pig meat

                                                                                                 Poultry meat                       Bovine meat
    (unit = Mt)

                   80

                   60

                   40
                                                                                             Sheep meat
                   20

                    0
                        1995    1997      1999   2001      2003        2005        2007        2009         2011        2013        2015         2017          2019   2021
                                                                                             year

                                                                                                                                                                 executive guide 2012 13
SECTION 2

                FIGURE 5: INCREASE IN MEAT CONSUMPTION BY WORLD REGION
FORECAST

                                                                                                                         percent per year and 5 percent per year,
                BETWEEN 200911 AND 2021
                                                                                                                         respectively, over the last decade, are
                                                                            Other 4 %                                    projected to average growth in the 2
                                                                                                                         percent per year range to 2021 (Figure
                                                                 Europe 6 %                                              3). In general, developing countries will
                                                North America                                                            account for 77 percent of additional
                                                8%                                                                       meat production growth during the
                                                                                                                         period to 2021. Poultry production will
                                                                                                                         continue to grow at the fastest rate (2.2
                                        Africa 8 %                                                                       percent per year) compared to other
                                                                                      Asia and Pacific                    meats, and will have overtaken pig meat
                                                                                      56%                                by the end of 2021 with the highest
                                                                                                                         production volume. By 2021, poultry
                                                                                                                         meat production will likely reach more
                                                                                                                         than 127 million metric tons, compared
                                 Latin America and                                                                       to pig meat’s nearly 126 million metric
                                 Caribbean 18%                                                                           tons (Figure 4).
                                                                                                                            As with demand for eggs, much of
                 Source: OECD-FAO Agricultural Outlook 2012-2021
                                                                                                                         the global consumption of meat will be
                                                                                                                           !
More data available in Market Data section of WATTAgNet
 Sign in or sign up as a user on www.WATTAgNet.com to download these datasets as spreadsheets.

 ➥World meat production projection to 2021 www.wattagnet.com/154339.html
 ➥Poultry meat consumption forecasts to 2021 www.wattagnet.com/154316.html
 ➥World poultry meat projection to 2021 www.wattagnet.com/154344.html
 ➥USA poultry forecasts 2010-2013 www.wattagnet.com/154327.html
 ➥USA egg long-term projections to 2021 www.wattagnet.com/154320.html
 ➥Population and GDP projections to 2050 www.wattagnet.com/154463.html
 ➥Meat production projections by year to 2021 www.wattagnet.com/154412.html
 ➥Global egg production and growth projections 1997-2030
  www.wattagnet.com/154404.html
 ➥Production growth by meat type 1995-2021 www.wattagnet.com/154415.html

meat as 90 percent of their extra meat, except for in Eastern      !! =      !' !
Europe. Consumers’ purchases in developing countries, on the         J*J)   VVX    =
   !=  >  (!  ?@J    =    !'        YJQ  
)K    =)Q  !@            

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                                                                                                              executive guide 2012 15
SECTION 2
     FORECAST

                    While meat exports overall are
                                                                        FIGURE 6: WORLD POULTRY MEAT GROWTH RATE PROJECTIONS
                 projected to rise by 19 percent by
                 2021 compared to 2009-11, led by
                                                                                               7.00
                 an expansion in poultry and beef                                                              Growth rate % 2002-2011                 Growth rate % 2012-2021
                 shipments, annual trade growth overall                                        6.00
                         
                 relative to earlier periods (Figure                                           5.00
                 6). Poultry trade, which grew at an

                                                                               growth rate %
                 annual rate of 5.5 percent over the                                           4.00
                 last decade, will grow at a rate of less
                 than 2 percent to 2021. The largest                                           3.00
                 contributors to poultry trade growth
                 will be the U.S. and Brazil, which                                            2.00
                 will account for nearly 80 percent of
                 world poultry trade expansion by 2021.                                        1.00
                 Import growth will also be led by
                                                                                               0.00
                 countries in the Middle East, Southeast                                              Production         Exports           Imports      Consumption Consumption
                 Asia and Latin America. EG                                                             (Kt rtc)         (Kt rtc)           (Kt rtc)     total (Kt rtc) per person
                                                                                                                                                                         (Kg rwt)
                                                                               Source: OECD-FAO Agricultural Outlook 2012-2021

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SECTION 3

                  Developing countries fuel poultry meat
MEAT PRODUCTION

                  production growth
                  High feed costs limit growth in many countries.

                  D
                            emand in rapidly growing developing                 TABLE 1: BROILER MEAT PRODUCTION AND CONSUMPTION BY COUNTRY
                            countries will drive world meat                     20082012
                            production to expand over the
                                                                                (x 1 million metric tons, ready-to-cook equivalent)
                  next decade, led by poultry meat production
                  growing at a rate of about 2 percent per year.                Country
                                                                                Production               2008             2009           2010              2011           2012 (Oct.)   2012 (April)
                  Nearly 104 million metric tons of poultry meat
                                                                                China                    11.84             12.1          12.55              13.2             13.8          13.73
                  will be produced in 2012 after surpassing the
                  100-million-metric-ton mark for the first time                 Brazil               11.033              11.023         12.312            12.863           13.602          13.25
                  in history in 2011 (Figure 1). Of this total, global          EU-27                 8.594               8.756          9.202              9.42             9.63            9.6
                  broiler production will account for nearly 82
                                                                                India                    2.49              2.55           2.65               2.9             2.75            3.2
                  million metric tons, according to a recent U.S.
                                                                                Mexico                2.853               2.781          2.822               2.9            2.892         2.925
                  Department of Agriculture World Agricultural
                  Supply and Demand Estimates report.                           Russia                    1.68             2.06           2.31             2.575             2.75         2.725
                                                                                Argentina                1.435              1.5           1.68              1.77            1.775           1.85
                  High input costs drive up                                     Turkey                    1.17             1.25           1.43             1.614             1.65         1.687
                  poultry meat prices
                                                                                Indonesia                 1.35            1.409          1.465             1.515             1.54           1.54
                     Prices in the poultry meat market
                  are expected to remain high, due to                           Thailand                  1.17              1.2           1.28              1.35              1.42          1.42
                       =                              Others               12.687              13.003         13.465            13.619           14.662        13.865
                  prices for feed grains and energy.
                                                                                Total Foreign        56.302              57.632         61.166            63.726           66.471        65.792
                  Prices for all meats are currently at
                                                                                United States        16.561              15.935         16.563            16.694           16.603        16.401
                  their highest levels in the past 15 to 20
                  years. In fact, in April, the Food and                        Total                72.863              73.567         77.729             80.42           83.074         82.193
                  Agriculture Organization of the United
                                                                                Source: USDA-FAS http://www.fas.usda.gov/psdonline/circulars/livestock_poultry.pdf
                  Nations’ meat price index rose to the

                  FIGURE 1: WORLD MEAT PRODUCTION TREND 20002012

                                          120.00

                                          100.00
                    million metric tons

                                           80.00

                                           60.00

                                           40.00
                                                                 Pork       Poultry             Beef and veal
                                           20.00

                                            0.00
                                                   2000   2001   2002    2003      2004           2005           2006       2007       2008        2009            2010       2011      2012
                                                                                                                  year

  18 executive guide 2012
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SECTION 3
MEAT PRODUCTION
                  FIGURE 2: GLOBAL BROILER PRICE INDEX VERSUS FEED                                                                                                                                  highest level of 182 points, surpassing
                  COST INDEX                                                                                                                                                                        the record set in November 2011 when
                                                                                                                                                                                                    the index reached 181. Poultry meat
                                                                                           250%                                                                                                     prices are projected to remain close to
                                                                                                                                        BROILER PRICE INDEX                                         current levels, according to FAO, so
                                                                                           200%                                                                                                     long as energy and feed costs remain
                                                                                                                                                                                                    high. Figure 2 illustrates the trend
                                                                                                                                                                                                    of rising broiler prices compared to
                                                                                           150%
                  index

                                                                                                                                                                                                    rising feed prices in major broiler-
                                                                                                                                                                                                    producing countries. However, as
                                                                                           100%                                                                                                     the industry adapts to higher costs,
                                                                                                                                                                                                    poultry producers should see their
                                                                                           50%                                                                                                            Z   
                                                                                                                                        US FEED COSTS INDEX                                         on-farm productivity will also be
                                                                                                                                                                                                    important for gains over the next
                                                                                                0%
                                                                                                                                                                                                    decade. For example, the number of
                                                                                                       QI
                                                                                                      QII
                                                                                                      QIII
                                                                                                      QIV
                                                                                                       QI
                                                                                                      QII
                                                                                                      QIII
                                                                                                      QIV
                                                                                                       QI
                                                                                                      QII
                                                                                                      QIII
                                                                                                      QIV
                                                                                                       QI
                                                                                                      QII
                                                                                                      QIII
                                                                                                      QIV
                                                                                                       QI
                                                                                                      QII
                                                                                                      QIII
                                                                                                      QIV
                                                                                                       QI
                                                                                                                                                                                                    birds is projected to increase over the
                                                                                                             2007                2008            2009         2010           2011        2012
                                                                                                                                                                                                    next decade to 24.3 billion head, but an
                                                                                                                         Feed            EU       US       Brazil       China
                                                                                                                                                                                                          
                                                                                                Source: Bloomberg/EU/Rabobank
                                                                                                                                                                                                    less feed per bird will be required.
                                                                                                                                                                                                       The expansion in meat production
                                                                                                                                                                                                         over the next 10 years will be
                  FIGURE 3: MEAT PRODUCTION INCREASE BETWEEN THE BASE                                                                                                                                    largely due to production growth
                  PERIOD 200911 AND 2021                                                                                                                                                                in developing countries, while
                                                                                           70                                                                                                            growth slows in many developed
                   meat production in million metric tons

                                                                                                                                                                       6.84      0.35                    countries. Between 2009-11 and
                                                                                           60
                                                                                                                                                              3.77                          13.63        2021, developing countries will
                                                                                           50                                             2.40      2.67
                                                                                                                                                                                                         account for 77 percent of the
                                                                                           40                                   21.69                                                                    growth in global meat production,
                                                                                                                                                                                                         compared to 23 percent from
                                                                                           30
                                                                                                                                                                                                         developed countries (Figure
                                                                                                                                                                                            46.13
                                                                                           20                    13.84                                                                                   3). Developing countries are
                                                                                           10                                                                                                            expected to increase their share
                                                                                                     8.20                                                                                                of global poultry meat production
                                                                                            0
                                                                                                     Beef       Pork     Poultry Sheep              Beef      Pork    Poultry    Sheep      total        to 63 percent by 2021 thanks to
                                                                                                             developing countries                          developed countries                           increases in productivity on farms
                                                                                                                                                                                                         and increasing returns to scale

                  FIGURE 4: DEVELOPMENT OF WORLD POULTRY MEAT PRODUCTION
                                                                                                  120.00
                                                    production (x 1 million metric tons)

                                                                                                  100.00

                                                                                                     80.00

                                                                                                     60.00

                                                                                                     40.00

                                                                                                     20.00

                                                                                                         0
                                                                                                              1995 1996          1997 1998 1999 2000         2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
                                                                                                                                                                                 year

  20 executive guide 2012
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                                                         t   service, spare parts and preventive
                                                             maintenance programs.

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SECTION 3

                  FIGURE 5: BROILER FARM MODERNIZATION TREND IN                                                 with larger farms.
MEAT PRODUCTION

                                                                                                                     =  
                  CHINA
                                                                                                                   [ =Z! =\=
                       100%                                                                                     ] !  ! '  
                                 7%                      6%          9%             12%            15%            !    '  ( 
                        90%      8%                     11%                                                     !!^"  V_=     
                                                                     15%
                        80%     15%                                                                                !    
                                                        18%                        25%
                        70%                                                                                     '  >$   
                                                                                                   40%
                        60%                                                                                        #     
                                                                     39%                                         ` {    ! '   
                        50%
                                                                                    38%                          [     ! 
                        40%                                                                                      J*)J=  {     
                                70%                     64%
                        30%                                                                        35%           [   !)QX  
                                                                     23%
                        20%                                                                                            J*)J=
                                                                                    18%                         !        |  
                        10%                                          14%
                                                                                    7%            8%              !     
                        0%                                                                                                
                                2000                    2005      2010 estimate 2015 forecast 2020 forecast
                                                                                                                  !!     
                                    backyard farm (
TABLE 2: USA POULTRY PRODUCTION, DISAPPEARANCE, MARKET PRICES
                                                                                                                                           broiler meat in 2012.
                                  2004         2005     2006       2007       2008       2009     2010     2011     2012       2013
                                                                                                                                              Africa’s poultry meat
 Production, million lb                                                                                                                    production growth in
 Broilers                         34,063       35,365   35,500     36,126     36,906     35,511   36,911   37,391   38,040     37,100      2012 has also been
 Turkeys                           5,454        5,504    5,682      5,958      6,246      5,663    5,643   5,727     5,775      5,935      limited by the effects of
 Per capita disappearance, retail lb                                                                                                       high feed costs and rising
                                                                                                                                           imports in such countries
 Broilers                              84.4      85.8     86.5       85.4       83.5       79.6     82.2    84.5      84.3       80.5
                                                                                                                                           as Ghana, Angola, Benin
 Turkeys                                17.1     16.7     16.9        17.5       17.6      16.9     16.4     16.1     16.2       16.3
                                                                                                                                           and the Congo.
 Market prices                                                                                                                                Russia’s poultry meat
 Broilers, 12 City, cents/lb           74.10    70.80     64.4      76.40      79.70      77.60     82.9   82-85    83-89       83-90      production growth, which
 Turkeys, Eastern, cents/lb            69.70    73.40      77.0     82.10      87.50      79.50     90.4   97-101   92-100    101-110      grew at an average of 14
 Forecasts are in bold.                                                                                                                    percent annually over the
 Source: USDA World Agricultural Supply and Demand Estimates and Supporting Materials.                                                     last decade, according
                                                                                                                                           to FAO, is projected to
vertical integration and modernization                            from about 1.8 million metric tons                         slow to an average of about 2 percent
in China means more broilers will                                 in 2011 to 1.9 million metric tons.                        a year over the coming decade to
be produced on commercial farms                                   Likewise in Mexico, broiler production                     2021. Russia’s government will spend
over the coming decade than in the                                growth will have slowed to just 0.9                        more than $9 billion on domestic
past and will account for the majority                            percent in 2012, Rabobank estimates,                       agriculture in 2013, including poultry
(40 percent) of production by 2020.                               bringing total broiler meat production                     production. Since 2006, the country
In comparison, the vast majority (70                              in Mexico close to 2.93 million metric                     has either added or modernized more
percent) of broilers were produced on                             tons in 2012.                                              than 400 poultry facilities. By 2020,
farms with less than 2,000 birds just                                In the U.S., falling chick placements                   Russia’s production of poultry meat is
a decade ago in China. Furthermore,                               will lead broiler meat production                          expected to stand at 4.5 million metric
India’s production of broiler meat                                growth to decline in 2012 by 1.8                           tons, making the country almost self-
is projected to increase from 2.9                                 percent. USDA forecasts the U.S.,                            EG
million metric tons in 2011 to a record                           the top producer, will have an output
3.2 million metric tons in 2012; an                               of nearly 16.4 million metric tons of
expanding middle class will also fuel                             broiler meat in 2012, with growth
demand in this country, and thus,                                 slowed by high feed costs. This is
greater production, also driven by                                the equivalent of approximately
vertical integration.                                             38,040 million pounds of broiler meat
                                                                  produced in 2012, declining to nearly
Production growth in Latin                                        37,100 million pounds of broiler
America slows                                                     meat in 2013 (Table 2). Additionally,
   Overall, world poultry meat                                    the U.S. will produce 5,775 million
production growth will slow from an                               pounds of turkey meat in 2012.
average of 2.2 percent per year the                                  High feed costs and a contracting
previous decade to 1.8 percent per year                           number of animal heads are also
over the next decade, largely because                             affecting the European Union’s meat
of slower growth in Latin America,                                production sector, which is expected
according to FAO. Rabobank estimates                              to decline overall by 0.4 percent in
that Brazil, one of the world’s largest                           2012 and 1 percent in 2013. Poultry
broiler-producing countries, will see                             meat, in contrast, remains the only
broiler production growth slow to just                            meat in the EU for which production is
3 percent in 2012, while Argentina’s                              expected to increase in 2012 and 2013.
broiler production grows at 4.5 percent                           The European Commission forecasts
in 2012. As Table 1 from USDA                                     an expansion in EU poultry meat
shows, Brazil’s production forecast                               production by about 1 percent in 2012
was revised lower to approximately                                and 0.3 percent in 2013, in spite of
13.3 million metric tons of poultry                               new animal welfare rules. This fourth-
meat in 2012, and Argentina’s                                     largest producing region is expected
production will increase only slightly                            to produce 9.6 million metric tons of

                                                                                                                                                    executive guide 2012 23
SECTION 4
EGG PRODUCTION

                 China remains world’s top egg producer in 2012

                 More than half of world’s                                                      ! !!JXK                     !   ƒ
                 total egg production from                                                         J*))=!               !!      
                 only five countries.                                                           !  V}     !          %ƒ  !  J*)J 
                    #'   ' !!                                                    !   
                 }}     !                                               ^"  J_   
                  !   @V                                                !  !JYQ              TABLE 1: EU25/EU27 EGG PRODUCTION
                    J*))‚ = !!                                                  
                                                                                                                                                              Gross
                  !    @}   ~                                           J*)J!! =[                                     production
                   =    K*                                             { !J    !                                 x 1 million
                        !                                                               Year          Region   metric tons % change
                  J*)J={                                              !            2004           EU-25      6.875
                 {    !                                                     !QVJ               2005           EU-25      6.833       -0.6
                    Z   !  !                                                       J*J*!QK
                                                                                                                                    2006           EU-25      6.534       -4.4
                   =" !!                                                        J*Q*=
                 #  $   % !                                                !                 2007           EU-25      6.521       -0.2
                  {    !                                                  "#!                              2007           EU-27      6.957
                  !  X*V                                                  "    [ =               2008           EU-27      7.067        1.6
                      J*)}!YKK                                           % !ƒ  =Z! =\           2009           EU-27      6.896       -2.4
                      J*Q*= '                                            !(   !                 2010           EU-27      7.049       2.2
                 {                                                        ' ~ !  
                                                                                                                                    2011           EU-27      7.112        0.9
                 !'     ^"  )_                                                  
                    [ =  !   ! =                                              %ƒ             2012           EU-27       7.04          -1

                 FIGURE 1: GLOBAL EGG PRODUCTION PROJECTION 19972030

                                                       100

                                                        90

                                                        80
                   production in million metric tons

                                                        70
                                                                                                                      1997/99       2015             2030
                                                        60

                                                        50

                                                        40

                                                        30

                                                        20

                                                        10

                                                         0
                                                             World   Developing Developing Sub-Saharan   Latin   Near East/ South Asia   East Asia     East Asia   Industrial   Transition
                                                                      countries countries     Africa    America North Africa                           excluding   countries    countries
                                                                                 excluding              and the                                          China
                                                                                   China               Caribbean
                   Source: FAO (http://www.fao.org/docrep/005/y4252e/y4252e07.htm#Ch5)

  24 executive guide 2012
FIGURE 2: CHINA ANNUAL EGG PRODUCTION TREND
19802012
                                             30.00
                                     tons)
      production(xx11 million metric tons

                                             25.00

                                             20.00                                                                                                                                           Looking for real results
                                             15.00                                                                                                                                            in breeder or broiler
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  eggproduction

                                             10.00
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 Egg

                                              5.00

                                              0.00
                                                        2000 01              02         03        04          05       06          07        08         09         10       11          12
                                                                                                                       Year
                                              Source: USDA

                                                                                                                                                                                               Premium+® breeder nest

FIGURE 3: US EGG LONGTERM PRODUCTION
PROJECTION TO 2021

                                              8.10

                                              8.00                                                                                                                                           Up to 10% more hatching eggs
    egg production (billion dozen)

                                              7.90

                                              7.80

                                              7.70

                                              7.60

                                              7.50                                                                                                                                             BroMaxx colony system

                                              7.40

                                              7.30
                                                       2010         11         12         13          14         15         16          17         18         19         20        21
                                                                                                                        Year
                                              Source: USDA Agricultural Projections to 2021 (http://www.ers.usda.gov/publications/oce-usda-agricultural-projections/oce121.aspx)
                                                                                                                                                                                              Up to 2 flocks more per year

fractionally higher than 2011’s 7.66                                                                                   table eggs, an increase of less than 1
billion dozen eggs produced. In 2012,                                                                                  percent over 2011. While feed prices
this second-largest egg producer is                                                                                    are expected to moderate, declines in                                 For more information about our
expected to produce 7.68 billion dozen                                                                                 egg prices and cut backs in the size of                               products and dealer addresses:
eggs, while the most recent projection                                                                                  >   ~    
for 2013 egg production shows a slight                                                                                 from greater expansion. Production of                                   Jansen Poultry Equipment
drop to about 7.5 billion dozen fueled by                                                                              hatching eggs in 2012 will also remain                                       Harselaarseweg 32
higher feed costs (Figure 3).                                                                                          below levels in 2011 as broiler producers                                    3771 MB Barneveld
   The majority of eggs produced                                                                                       cut back on production.                                                       The Netherlands
are table eggs for consumption; in                                                                                        As in many countries around the                                          Tel: +31 (0)342-427000
2013, the U.S. is expected to produce                                                                                  world, the majority of U.S. table eggs, 95                                       info@jpe.org
approximately 6.6 billion dozen                                                                                        percent, according to a study released by

                                                                                                                                                                                                  www.jpe.org
                                                                                                                                               executive guide 2012 25
SECTION 4
EGG PRODUCTION
                  TABLE 2: INDIA EGG PRODUCTION AND PER CAPITA                                                                                TABLE 3: NUMBER OF LAYER FARMS AND LAYERS IN
                  AVAILABILITY                                                                                                                JAPAN
                                                                                                    Human                                                          Number of Layer                                              Average head
                  Year                                               Egg production               population                Per capita                                Farms                    Number of Layers                   per farm
                  (March-Feb.)                                          (million)                  (million)               availability
                                                                                                                                                  Year                   farms                  thousand head                   thousand head
                  2001-02                                                38,729                         1,040                  37
                                                                                                                                                  2003                    4,340                      137,299                        31.6
                  2002-03                                                39,823                         1,056                  38
                                                                                                                                                  2004                    4,090                      137,216                        33.5
                  2003-04                                                40,403                         1,072                  38
                                                                                                                                                  2005                      -                           -                             -
                  2004-05                                                45,201                         1,089                  42
                                                                                                                                                  2006                    3,610                      136,894                         38
                  2005-06                                                46,235                         1,106                  42
                                                                                                                                                  2007                    3,460                      142,765                        41.3
                  2006-07                                                50,663                         1,122                  45
                                                                                                                                                  2008                    3,300                      142,523                        43.2
                  2007-08                                                53,583                         1,138                  47
                                                                                                                                                  2009                    3,110                      139,910                         45
                  2008-09                                                55,562                         1,154                  48
                                                                                                                                                  2010                      -                           -                             -
                  2009-10                                                60,267                         1,170                  51
                                                                                                                                                   2011                   2,930                      137,352                        46.9
                  2010-11                                                63,024                         1,186                  53
                                                                                                                                                  2012                    2,810                      135,477                        48.2
                  2011-12 (est.)                                         65,480
                                                                                                                                              Source: Ministry of Agriculture, Forestry and Fisheries, “Livestock Statistics”
                  Source: State/UT Animal Husbandry Departments

                 FIGURE 4: PERCENT CHANGE IN EU LAYING HEN                                                                                                                              The third-largest egg-producing
                                                                                                                                                                                    country, India, produces nearly 2.86
                 POPULATION BETWEEN 2012Q1 AND 2011Q1
                                                                                                                                                                                    million metric tons of eggs annually,
                                                     2,000                                                                                                                          according to the Associated Chambers of
                                                                                                                                                              +10%
                                                                                                                                                   +1% +9% +15%                     Commerce and Industry of India. Table
                  number of laying hens (x 1,000)

                                                          -                                                                                                                         2 shows the trend of egg production
                                                                                                             -18% -2%
                                                                                               -41%
                                                                                                      -14%                                                                          in India and per capita availability of
                                                     -2,000                             -24%
                                                                                  -7%                                                                                               eggs to the country’s population. Japan,
                                                     -4,000                 -10%
                                                                                                                                                                                    the fourth largest producer, is thought
                                                                        -34%                                                                                                        to have seen a drop in egg production
                                                     -6,000      -15%
                                                                                                                                                                                     J*))!J*)J=   
                                                     -8,000                                                                                                                         layers and layer farms in that country
                                                                                                                                                                                    ! ZJ*))=\!J=KQ* 
                                                    -10,000   -20%
                                                                                                                                                                                       )QXV   
                                                    -12,000                                                                                                                         However, this number will decrease
                                                                    France
                                                                   Poland
                                                                   Ireland
                                                              Netherlands
                                                                        UK
                                                                  Czech R
                                                                 Hungary
                                                                   Austria
                                                                 Belgium

                                                                 Slovakia

                                                                Lithuania
                                                                 Portugal
                                                                   Greece
                                                                     Spain
                                                                      Italy
                                                                Germany

                                                                 Bulgaria
                                                                Denmark
                                                                  Finland
                                                                  Sweden
                                                                 Slovenia

                                                                 Romania
                                                                     Latvia
                                                                   Estonia

                                                                                                                                                                                       J*)J J=Y)*   
                                                                                                                                                                                    )Q}}   ^Q_
                                                                                                                                                                                        Egg production is expected to grow
                                                                                                                                                                                    in some other egg producing countries
                                                                                                                                                                                     J*)J=` $   ‡  
                                                                                                                                                                                     J*)J !     
                                                                                                                                                                                    consecutive increase in egg production
                 the United Egg Producers, are produced                                                                 EU egg production falls                                     with growth of 1.4 percent, an increase
                 in layer houses with conventional                                                                         With a smaller laying hen population                      YJ   '     J*))
                 cage systems. In contrast, January 1                                                                   as producers invest in new cage systems                     ` $  Z   ‰ !
                 marked the end of a 12-year transitional                                                               and convert production out of battery                       ƒ     !  ` $  ! 
                 period banning the use of these popular                                                                cages, egg production in the EU is                             !@X))  ! $ 
                 conventional cage systems in another                                                                   forecast to be about 1 percent lower in                              J*)Jƒ   =
                 major egg-producing region, the                                                                        J*)J  J*))=   X*V                      Russia has seen its egg production increase
                 European Union. Figure 4 illustrates the                                                               metric tons (Table 1). The region’s                           J**Y= QY)  
                 change in laying hens in the EU between                                                                largest egg producers remain France and                        { !V)K    
                    ‡   J*))!                                                                   Spain, followed by Italy, Germany, the                      J*)J= !         
                 ‡   J*)J                                                                                        Netherlands and the UK.                                     Agriculture Nikolai Fyodorov. EG

  26 executive guide 2012
More data available in Market Data section of WATTAgNet
 Sign in or sign up as a user on www.WATTAgNet.com to download these datasets as spreadsheets.

 ➥Global egg production and growth projections 1997-2030–
  www.wattagnet.com/154404.html
 ➥European Union number of laying hens by country 2000-2011 –
  www.wattagnet.com/54433.html
 ➥Largest egg producing countries in 2010 –
  www.wattagnet.com/154312.html
 ➥USA egg long-term projections to 2021 –
  www.wattagnet.com/154320.html
 ➥EU egg balance sheet 2004-2012 –
  www.wattagnet.com/154395.html
 ➥China annual egg production trend 1980-2012 –
  www.wattagnet.com/154401.html
 ➥India egg production and per capita availability 1990-2012 –
   www.wattagnet.com/154407.html
 ➥USA poultry forecasts 2010-2013 –
  www.wattagnet.com/154327.html

Escent®                            Af l o r i n ®                     N ovi b a c ®

               N ovyr a t e ®                       N ovi o r o ®                       Lu m a n c e ®

                                  Mycotoxin Risk Assessment
                                  Wet Litter
                                  Natural Pigmentation
                                  Salmonella Control
                                  Liver Support
                                  Intestinal Health                      www.innovadglobal.com

                                                                                    executive guide 2012 27
SECTION 5

        Poultry meat and egg trade in
TRADE

        international markets
        Population increases, rising                                    FIGURE 1: GLOBAL TRADE OF SHELL EGGS AND EGG
        costs lead to trade growth in                                   PRODUCTS
        poultry and egg products.
                                                                                          2,500,000
           A growing population and demand
        growth in the market for livestock
        products, especially in developing                                                2,000,000
                                                                                                                                         Egg products: CAGR: +6.6%

                                                                            metric tons
        countries, has led to rapid trade growth
        in poultry and egg products.                                                      1,500,000

        Changes in the trade of egg                                                       1,000,000
        products
           In the global market for eggs, shell                                                                                          Shell eggs: CAGR +5.5%
        eggs have historically been the most                                               500,000
        commonly traded form of eggs (Figure
        1); however, the market for eggs is
                                                                                                      ‘95   ‘96   ‘97 ‘98 ‘99 ‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08
        expected to shift over the next decade
        on Rabobank projections that egg                                                                                     year
        industry consolidation will continue                                                                           egg products     shell eggs
        and increasing globalization will occur                         Source: Nan-Dirk Mulder/Rabobank

        in the egg processing and egg products
        industries.

         TABLE 1: EU EXPORTS OF EGGS TO MAIN                                                      One country expected to see growth in its egg processing sector over
         TRADING PARTNERS                                                                     the coming years is India. Figure 2 shows the country’s relatively low egg
                                   Total egg exports (except hatching) in                     production costs compared to the EU and some Asian countries, making
                                       product weight (metric tons)                           it a potential growing exporter over the next decade. India’s dried egg
         Country                       2011                    2010                           products are already well accepted in Europe, but are only produced by a
         Switzerland                   36,600                  39,070                         few companies, so the country shows much potential for expansion in the
         Angola                        17,496                  10,414                         global export market.
                                                                                                   %ƒ(         J*)J=Q)
         Japan                          8,785                   6,401
                                                                                                 @K)  ! $%ƒ  (      
         United Arab Emirates           7,905                  5,600
                                                                                              J*)J QV     !VK@  ! $='! ŠVQX
         Oman                           2,792                  2,600                             (    %ƒ  J*)J  ‚  
         Argentina                      1,695                   1,678                         Kong, followed by Canada, United Arab Emirates, the Bahamas and
         USA                            1,661                   4,118                         Angola. Exports to Japan, an important market for the U.S. and typically
         Albania                        1,303                   4,118                            (    !  ! =! !    
                                                                                               J*)JJ}   ŠJ)Y  ‚ ' =  % 
         Israel                          1,112                   991
                                                                                              conventional cages has increased egg production costs in that region,
         Norway                           878                    196
                                                                                                      J*)J~)Q!   !  ( 
         Russia                           604                    652                            %ƒ       J*)J=  %~JX    !
         Ukraine                          567                    709                          )J*     !   % !ƒ   !   
         India                            468                    925                            J*))='! ŠJ@X  =    QY   
         Croatia                          380                    395                          U.S. total exports globally, according to the United States Department of
                                                                                              Agriculture’s Foreign Agricultural Service.
         Libya                            226                    201
                                                                                                  ZJ*)Q=(   !  !   %ƒ ( ! 
         Source: European Commission
                                                                                                 (!  ‡ '  J@@  ! $  J*)Q=

28 executive guide 2012
More data available in Market Data section of WATTAgNet
 Sign in or sign up as a user on www.WATTAgNet.com to download these datasets as spreadsheets.

 ➥EU egg balance sheet 2004-2012 – www.wattagnet.com/154395.html
 ➥USA poultry forecasts 2010-2013 – www.wattagnet.com/154327.html
 ➥USA broiler export trend 2005-2011 – www.wattagnet.com/154427.html
 ➥EU egg imports by product 2011-2012 – www.wattagnet.com/154421.html
 ➥Poultry meat trade long-term projections to 2021 –
  www.wattagnet.com/154324.html
 ➥World meat market production and trade estimates 2010-12 –
  www.wattagnet.com/154424.html
 ➥World meat export trends 1999-2021 – www.wattagnet.com/154336.html

                                                                                                       products by the end of 2012; most recent data available show
 TABLE 2: EU EGG IMPORTS BY PRODUCT IN 2011
 (February 2011-January 2012)                                                                          the region’s 2011 dried whole egg import volume totaled
                                                         Volume
                                                                                                       10,559 metric tons in eggs equivalent (Table 2).

                                          metric tons
 Egg Product                            egg equivalent           metric tons product
                                                                                                       Poultry meat trade driven by demand from
                                                                                                       Asian countries
 Shell eggs imports                           1,686                            1,686
                                                                                                          In the international market for poultry meat, a total of
 Liquid/frozen whites                           956                                  824               7.126 million metric tons will be imported in 2012 by major
 Liquid/frozen whole eggs                       280                                  242               importing countries and that number is projected to grow
 Dried whole eggs                            10,559                            2,336                   over the next decade by 1.5 million metric tons (21 percent),
 Dried egg yolk                               3,220                             1,309                  according to the latest agricultural projections from USDA.
                                                                                                       Major importers are expected to trade 8.634 million metric
 Frozen/liquid yolk                              51                                  44
                                                                                                       tons of poultry meat by 2021.
 Dried whites                                 3,025                                  353
                                                                                                          Russia, historically the largest world importer of poultry
 Total metric tons                           19,777                            6,794                   meat, will see its import volume decline from an estimated
 Source: International Egg Commission, “The European egg market situation,” Herman                     374,000 metric tons, ready-to-cook, of poultry meat in 2012,
 Versteijlen, director agricultural markets, European Commission                                       to 254,000 metric tons in 2013, which will decline further

which is slightly higher than the forecast
for 2012. Growth in the U.S. egg export
                                                                  FIGURE 2: PRODUCTION COST OF EGGS BY COUNTRY
market will be driven by strong demand
from growing Asian countries, notably                                                      90
Hong Kong, Japan and Korea. EU-27
member states exported 111,121 metric                                                      80
tons of eggs in 2011, 83,543 metric                                                        70
tons of which are for consumption.
                                                                                           60
Switzerland was the top destination of
                                                                       (EUR ct/kg)

main trading partners for EU-27 eggs,                                                      50
as that country imported 36,600 metric                                                     40
tons of eggs in 2011, 29,939 metric tons
of which were eggs for consumption                                                         30
(Table 1).                                                                                 20
   Of the 6,788 metric tons of eggs
imported by EU-27 member states,                                                           10
1,799 metric tons were eggs for                                                             0
consumption. The EU region will again                                                             EU             US           Brazil      Ukraine       India
                                                                                                                             country
import the greatest amount of dried                                Source: Nan-Dirk Mulder/Rabobank
whole eggs compared to other egg

                                                                                                                                                     executive guide 2012 29
SECTION 5
TRADE
        FIGURE 3: 2013 POULTRY MEAT IMPORT PROJECTION
                                                                                                                                                                                                                                                                                                      to reach eventually an estimated

                                                                                                                                                                                                                      Middle East
                                                            1,600                                                                                                                                                                                                                                     114,000 metric tons in 2021 (Figure
                                                                                                                                                                                                                                                                                                      3). Poultry meat imports in the

                                                                                                                                                                                                                      Other
                                                                                                                                                                                                                                                                                                      Middle East now account for more
                                                            1,400
                                                                                                                                                                                                                                                                                                      than 40 percent of imports by major
         poultry meat imports (thousand metric tons, rtc)

                                                                                                                                                                                                                                                                                                      importers and is expected to increase

                                                                                                                                                                                                       Saudi Arabia
                                                            1,200                                                                                                                                                                                                                                     to more than 50 percent by 2021. The
                                                                             European Union

                                                                                                                                                                                                                                                                                                      largest single-country importer is

                                                                                                                                                                                                                                                                            Other SubSaharan Africa
                                                            1,000                                                                                                                                                                                                                                     now Saudi Arabia, which will import
                                                                                                                       Mexico

                                                                                                                                                             Japan
                                                                                                                                                                                                                                                                                                      an estimated 880,000 metric tons of
                                                                                                                                 Central America/Caribbean                                                                                                                                            poultry meat in 2012 and 926,000 in

                                                                                                                                                                                                                                                   West African Community
                                                             800
                                                                                                                                                                                                                                                                                                      2013. Japan, the world’s second largest
                                                                                                                                                                                                                                                                                                      poultry meat importer, will import an
                                                             600
                                                                                                                                                                     Hong Kong                                                                                                                        estimated 805,000 metric tons in 2012,
                                                                                                                                                                                 China                                                                                                                declining to 800,000 metric tons in

                                                                                                                                                                                                                                    North Africa
                                                                                                                                                                                         South Korea
                                                             400
                                                                    Russia

                                                                                                                                                                                                                                                                                                      2013. The third largest poultry meat
                                                                                              Other Europe
                                                                                                             Canada

                                                                                                                                                                                                                                                                                                      importer in 2012, the EU, will import
                                                             200                                                                                                                                                                                                                                      nearly 800,000 metric tons in 2012
                                                                                                                                                                                                                                                                                                      but is expected to take over as the
                                                               0                                                                                                                                                                                                                                      second largest importer in 2013 at an
                                                                                                                                                                 Importers                                                                                                                            estimated 808,000 metric tons. Mexico
                                                     Source: USDA Agricultural Projections to 2021 (http://www.usda.gov/oce/commodity/archive_projections/USDAAgriculturalProjections2021.pdf)                                                                                                        is also becoming one of the world’s
                                                                                                                                                                                                                                                                                                      largest importers of poultry meat. The
                                                                                                                                                                                                                                                                                                      country’s import volume is projected
                                                                                                                                                                                                                                                                                                      to rise from 760,000 metric tons in
                                                                                                                                                                                                                                                                                                      2011 to 789,000 metric tons in 2012
                                                                                                                                                                                                                                                                                                      and 804,000 metric tons in 2013.
                                                                                                                                                                                                                                                                                                         Total exports of poultry meat in
        FIGURE 4: 2013 POULTRY EXPORT PROJECTION                                                                                                                                                                                                                                                      2012 by major traders will total an
        IN MILLION METRIC TONS, RTC                                                                                                                                                                                                                                                                   estimated 9.163 million metric tons,
                                                                                                                                                                                                                                                                                                      based off USDA forecasts, and are
                                                                                                                      European Union                                                                                                                                                                  projected to rise to 11.067 million
                                                                                                                      1,279                                                                                                                                                                           metric tons over the next decade to
                                                                                                                                                                                                                                                                                                      2021.
                                                                                                                                                                                                                                             Brazil                                                      Brazil, the world’s largest exporter,
                                                                                                                                                                                                                                             3,620                                                    will ship approximately 3.555 million
                                                                                                                                                                                                                                                                                                      metric tons of poultry meat in 2012 and
                                                                                                                                                                                                                                                                                                      3.620 million metric tons in 2013. The
                                                                                                                                                                                                                                                                                                      U.S., a close second, is estimated to
                                                                                                                                                                                                                                                                                                      export 3.413 million metric tons in 2012
                                                                                                                                                                                                                                                                                                      and 3.442 million metric tons in 2013
                                                                                                                                                                                                                                                                                                      (Figure 4). Over the coming years, the
                                                                                                                                                                                                                                                                                                      U.S. market share may increase thanks to
                                                                                                                                                                                                                                                                                                      trade with Saudi Arabia, Japan and Hong
                                                             United                                                                                                                                                                                                                                   Kong, where the compound average
                                                             States                                                                                                                                                                                                                                   growth rate is growing faster than in
                                                             3,442                                                                                                                                                                                                                                    Brazil, according to Adrian Westerstrate,
                                                                                                                                                                                                                                                                                                      global co-head of Rabobank’s Animal
                                                                                                                                                                                                                                                                                                      Protein Sector. Concurrently, though,
                                                                                                                                                                                                                                                                                                      U.S. exports have grown slower than
                                                                                                                                                                                                                                                                                                      Brazil’s in China, Japan and Kuwait. For
                                                                                                                                                                                                        China                                                                                         example, U.S. exports of broiler meat
                                                                                                                                Thailand                                                                442                                                                                           have remained steady, as the country
                                                                                                                                509                                                                                                                                                                   exported 6.9 billion pounds of broiler

30 executive guide 2012
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