PoultryUSA - June 2018 - 8
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Poultry Market Prospects
BY MARK JORDAN
US broiler industry faces
uncertain trade future
Protections trade rhetoric paired with constantly shifting trade alliances
creates uncertainty about the size and role of trade for the broiler industry.
Amount of US chicken exports to top five destinations
and percentage of total US production exported
concentration (left axis)
Top 5 countries % of total exports
% of production (right axis)
Export % of production
A decade ago, few people would have
predicted Cuba and Angola - with a
combined population about the size
of California - would become two of
the top three foreign destinations for
U.S. broiler meat in 2017.
This underscores how much the
trade landscape can change in a short
amount of time and highlights a shift
from higher levels of concentration
to greater diversification among trading partners. It also raises questions
around future patterns and trends.
Source: United States Department of Agriculture, Economic Research Service & National Agricultural Statistics Service
A landmark trade deal in the
early 1990s resulted in a tidal wave of
chicken shipped to the hungry former
Soviet Union. Russia became an important export destination, with more
than 25 billion pounds of chicken
shipped there between 1993 and 2009.
However, Russia aggressively pursued food self-sufficiency. In 2010, it
implemented trade restrictions on U.S.
chicken processed with a chlorine
rinse. Exports tumbled but remained
fairly sizeable. For political reasons,
the relationship ended in 2014, forcing
the U.S. industry to look elsewhere.
The percentage of U.S. chicken production headed to foreign markets is
slumping in recent years, averaging between 15 percent and 17 percent.
Recent trends and challenges
With Russia closed off, Mexico
emerged as the top foreign destination for U.S. chicken and Cuba and
Angola also rose in prominence.
Ultimately, broiler exports spread
out over a broader mix of countries
instead of being concentrated among
a few - with Russia at the center.
Between 2011 and 2014, the
share of total U.S. broiler exports
to the top five destinations averaged barely more than 40 percent,
down from more than 55 percent in
the past. The export share of U.S.
broiler production consistently approached - and even exceeded - 19
percent, peaking in 2012.
Things changed in 2015 after a
crippling highly pathogenic avian
influenza outbreak. Sweeping trade
restrictions followed and the broiler
industry struggled to get exports
back into gear. The mix of export
destinations remains relatively diverse, but during the past two years,
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