Poultry and soybean demand drops
April 30, 2013 Category Foreign trade, Weekly
The bird flu outbreak hit China’s poultry consumption and curbed soybean demand. The drop-off in Chinese demand for soybeans used to feed poultry and livestock could last for months, as consumers lose their appetite for poultry. China, which buys 60% of the world’s traded soybeans, could further reduce bean imports this year – already down some 13% year-to-date on food security concerns and high stocks – which will likely curb a rally in benchmark Chicago prices. Poultry sales have dropped by 80% in eastern China and by about 30% in other parts of the country, analysts and industry officials say. Fewer birds to feed means less demand for soybeans and corn. “We don’t see any signs of recovery” for poultry consumption, said Wang Xiaoyue, Analyst at Beijing Orient Agri-business Consultant Co. “There is a possibility of a 20% to 30% decline in consumption this year if the flu lasts for some time.” The price of one-day-old chicks, which poultry farmers buy from breeders to restock, have plunged more than 85%, according to the National Poultry Industry Association. China’s soybean imports had risen for eight consecutive years, rising almost five-fold to 58.39 million tons last year from 10.43 million tons in 2000, driven by rising wealth and demand for high-protein food such as pork, poultry and seafood. China now accounts for half of the world pork consumption and close to 15% of the global poultry production. This year, soybean imports have already dropped more than 13% to 11.49 million tons in the first quarter from a year ago.
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