Ukraine expected to become major player in broiler exports

Peter Pawlenko of AJC International talks about the Ukraine's emergence as a major competitor for broiler exports.

Most people in the U.S. broiler industry likely do not consider the Ukraine as a major competitor for exports, said Peter Pawlenko, director of global poultry, fruits and vegetables at AJC International. But, he told those attending the USPOULTRY Financial Management Seminar on June 24 that they should. With a rapidly growing pace of production, the broiler supply in Ukraine has also grown.
The product that they have is very appealing to the developing countries in Europe, Asia and Africa that are looking to import more poultry. The whole birds produced there range from 3.75 to 5 pounds, but the price per pound is much more appealing at 65 cents per pound, said Pawlenko.
"This product is fresh-frozen from recent production. There's nothing wrong with it. It hasn't been in a freezer for a year," he said. "Oh, and by the way, it's already across the ocean, sitting in a port in the Ukraine."
Adding to the appeal of Ukrainian poultry is that it meets the halal designation, which gives it a competitive advantage over most U.S. poultry for Islamic consumers. Pawlenko said as the world's Islamic population is expected to grow by 25 percent by 2020, it will be even more of an advantage in the future.
U.S. processors have also been stubborn in the past when it comes to packaging sizes, but the Ukrainian broiler product comes in a smaller, 14 kilogram boxes, making it "the perfect size for international markets," Pawlenko said.
Pawlenko cautioned U.S. processors not to get complacent or overconfident because other developing countries, like the Ukraine, can emerge and be competitive in export markets.
"This is really to me a big surprise where the competing product is going to come from. It's a real wake-up call to the industry and a wake-up call for the buyers around the world. A lot of these countries are advancing very rapidly," he said. 

Argentina aims to raise broiler exports by 2017

Argentina exports 18% of its total broiler meat production and aims to increase this share to 25% by 2017, according to reports.
Of the 60 countries Argentina currently exports to, Venezuela is its top destination, receiving 60,000 metric tons of meat, while Chile comes in second at 30,000 metric tons of meat annually. Argentina also expects its domestic consumption of chicken meat to grow from the current 39 kilograms per head per year to 45 kilograms by 2017. In 2003, that number was just 21 kilograms. “Argentina only recently entered the world poultry market, but its low cost structure and favorable sanitary status make it a key player to meet growing global demand, providing it continues to invest in expansion," said a spokesperson for Dutch-based agro-investment bank Rabobank. “Although Argentina’s poultry industry is relatively concentrated, opportunities remain for consolidation by large domestic companies or foreign players entering the market.”
Argentina currently has roughly 40 poultry companies throughout the country, producing a total of 1.7 million tons of meat.

EU broiler exports to decrease in 2011

European Union broiler exports are expected to drop more than 5% in 2011, due largely to tightened Russian import quotas, according to the U.S. Department of Agriculture.
The drop, the first in the last five years, will bring total EU exports to 940,000 metric tons, down from 2010's 7.3% jump over 2009 to 992,000 metric tons. Russia has tightened the imports it will allow, under tariff-rate quotas, to 350,000 metric tons.
The domestic market for poultry is also expected to slow in 2011. "Poultry meat consumption growth — around 1% — is less than the demographic one, showing that, per capita, consumption is probably slightly decreasing," said a USDA report. "Several market analyses showed that, while the average consumer switched from beef or pork meat to poultry meat, the lower income consumers simply reduced their protein purchases." The United Kingdom is expected to be hit particularly hard by the combination of decreased exports and lowered domestic interest, seeing near-zero growth in 2011 — a significant difference from 2010's 8% output growth.