industry profitability slows meat output recovery in 2007
Global meat output in 2007 is set to rise by 2.3 percent to almost 283 million tonnes, an increase of over 6 million tonnes from the previous year, within the context of a recovery in consumer confidence in meat products. Around two-thirds of the output gain are expected to stem from expansions in Asia, particularly in China, which accounts for three-quarters of the Asian expansion. Continued high economic growth is supporting the rise in per capita consumption in Asia and stimulating the global expansion in meat production. South American potential for much greater output gains could be affected by the surge in feed costs, a low cow inventory in Brazil and recent policy developments in the Argentina’s beef sector. According to the current prospects, meat production by the developing countries may grow by 3 percent in 2007, more than three times faster than expected for the developed countries. This would leave developing countries’ share of global meat output unchanged at around 60 percent, after having risen from 43 percent in the early 1990s due to continuous investment in the sector.
Beef output is expected to increase fractionally in 2007 to 67 million tonnes. The price recovery is fostering a retention of animals for herd rebuilding and higher feed prices could negatively affect the slaughter weight of animals. Moreover, Brazil’s continuously declining stock of cows and Argentine’s policy measures1/, which have been implemented to keep domestic beef prices affordable and inflation in check, are leading to negative growth in beef output in these two countries. Most of the significant production gains, with the exception of New Zealand, are expected to be concentrated in a few developing countries, particularly in the dynamic economies of China and India.
Positive producer returns in pigmeat over the past few years have led to an expansion of the sector in many countries. However, the recent surges in feed prices are set to reduce the growth in global production to just over 3 percent in 2007, or 3.3 million tonnes, to 110.7 million tonnes. Although swine and pork production is becoming more concentrated in the feed grain producing areas of China, the strength of feed prices has not yet depressed the expansion of the sector and output is expected to continue expanding at 4 percent, largely sustained by an expanding domestic market. Combined with a favourable outlook in Brazil, Chile and Vietnam, the share of developing countries in global pigmeat production is expected to rise to almost 64 percent this year. By contrast, output gains in developed countries are likely to be rather limited, at slightly over 1 percent compared with 2006. Only the United States and European Union are expected to register more pronounced growth, as the industries responds to positive returns of previous years. For the third consecutive year, production may fall in Canada, which exports over 50 percent of its output, constrained by a strengthening of its currency and by the recent surge in feed grain prices, which is coinciding with a cyclical drop in pig prices.
As consumption and prices of poultry meat recover, global poultry output is set to increase by over 2 million tonnes to 86 million tonnes in 2007. Growth is mostly concentrated in developing countries, which will account for almost three quarters of the world-wide gain. Both Asian and South American markets are projected to expand their output by 2.5 and 5.3 percent, respectively, supported by higher prices and a resumption of demand in both domestic and traditional export markets. Poultry production in both Egypt and Turkey, greatly affected by AI in 2006, is rapidly recovering in 2007, as domestic consumption gathers momentum. Production, however, is still expected to fall short of pre-AI levels. The African continent as a whole shows a healthy 4 percent increase in poultry production, but this could be hindered by the persistence of AI in countries including Côte d'Ivoire, Ghana, Nigeria and Sudan.
Global Ovine meat output is expected to reach 13.9 million tonnes in 2007, an increase of 2.1 percent from last year. For the most part, this growth is expected to be concentrated in Asia, which accounts for more then 60 percent of global production, and in particular in China, the Islamic Republic of Iran and Pakistan. The production prospects for Australia and New Zealand are quite erratic, due to the unfavourable weather situation. This is making it difficult to assess whether the drought-induced slaughter in Australia will stop shortly or if producers may be forced to sell some of their core breeding stock in response to the lack of feed and water. Output in Argentina, and particularly Uruguay, is fast recovering, largely sustained by government programmes aimed at reviving a sector that has been severely constrained since the late 1990s by low wool prices. About the italian market meat i find the Tonazzo Italian market leader of beef meat, distribute by Compacarni
