Bright future for poultry industry in MAF forecasting report

18 December 2002

The production of chicken meat has doubled over the last ten years and strong growth is forecast for the years through to 2005/06.

That’s the key finding on poultry in the Ministry of Agriculture and Forestry’s latest comprehensive forecasting document – the Situation and Outlook for Agriculture and Forestry (SONZAF) December 2002.

In further good news, the report says producer and retail prices are likely to remain stable over the forecast period.

Looking at the year ended September 2002, the report says production of poultry meat in New Zealand is estimated at 133,000 tonnes dressed weight (dw) – a jump of 12 percent on the previous year.

Contributing to this growth were increased yields from breeding hens and rising average slaughter weights. Other factors that have driven the increase in production are population growth, competitive retail prices for chicken products and a rising per capita consumption of poultry meat.

The report’s author, information analyst Mieke Wensvoort says there is strong demand for low fat white meat.

"In the year ended September 2002, New Zealanders consumed on average 34 kg of poultry meat each. This compares to 52 kg in Israel and 40 kg in the US," she says.

The growth of fresh and processed poultry products continues to outstrip frozen chicken meat sales, with 74 percent of chicken now sold fresh.

New Zealand’s three main poultry production firms (and the dozen small producers) are benefited by a lack of any real import competition. The report says the small size of the New Zealand market and the cost of meeting import requirements, appear to result in the market being commercially unattractive to overseas exporters of poultry products at present.

Looking out to 2005/06, the report projects that poultry meat production will continue to grow at seven percent per year and will total 174,000 tonnes dw by 2005/06. Existing trends suggest that the demand for low fat white meat will continue, and this, together with the competitive pricing of chicken, is expected to drive the ongoing demand for poultry meat.

Per capita consumption of poultry meat is expected to increase by two kg per year throughout the forecast period. "Producers are offering consumers an increasing range of value-added poultry products," says Ms Wensvoort. "Chicken chips, nibbles and nuggets, bites and char-grilled breasts, smoked and sauced chicken are just a few of a growing range of chicken meal options and this trend is expected to continue. A recently introduced chicken product which tastes like bacon may even lead to chicken becoming a breakfast food!"

Retail poultry prices are projected to remain stable over the forecast period due to lower projected prices for competing meat products. The assumption of a slowly appreciating New Zealand dollar together with projected falling international meat prices are expected to lower New Zealand retail meat prices.

The price to the poultry producer is projected to rise slowly to reach $1.49/kg live weight by the year ending September 2006.

Looking to the longer term, the report says potential changes to New Zealand’s biosecurity system are particularly relevant to the poultry industry, which is free of avian diseases present overseas. The legitimate sanitary control measures applied to maintain this favourable animal health status and the geographic isolation of New Zealand have the incidental effect of providing some protection against competing product.

The evolution of the New Zealand sanitary regime, the disease profile of exporting countries and scientific advances in the prevention or reduction of risks of pathogen transmission are matters which could have profound effects on the poultry industry.

Other key issues that may influence the industry to modify production methods are antibiotic resistances in poultry, consumer perceptions of the use of antibiotics and animal welfare concerns.

For further information, please contact:

Mieke Wensvoort, Information Analyst, MAF Policy

Contact MPI

for general enquiries phone

0800 00 83 33