Avian influenza to shake up 2015Global issues like avian influenza and trade restrictions will have a significant impact on global poultry trade in 2015, according to a new report on the poultry industry from Rabobank.

In the report, Rabobank says regions affected by avian flu outbreaks, like the EU and Canada, will suffer from lost export markets and this will affect local prices.

However, the outlook for 2015 is strong for non-affected regions like the US and Brazil which could benefit from strong demand, low feed costs and high competing meat prices. By capitalizing on some of these market conditions, Rabobank says these countries could capture some of the export market share from the EU and Canada.

“A key concern for the coming months is the spread of avian flu, which has become a global issue in recent months. Several avian flu strains are already endemic in several parts of Asia and Mexico, and the disease is increasingly spreading globally via wild birds,” said Nan-Dirk Mulder, Rabobank analyst.

According to Rabobank, avian flu virus pressure will become a global issue for the industry after new high pathogenic avian flu outbreaks in the EU, Canada, India and Egypt add to existing cases in East Asia and Mexico. These regions will continue to suffer economic damage though industries need to prepare for ongoing disease pressure, especially in times of bird migration.

Trade restrictions, specifically Russia's import ban on US and EU poultry meat, will lead to ongoing record high prices and margins in Russia, analysts say.

“The outbreaks of avian flu in Northwest Europe have been a big wake-up call for the Russian industry as markets have been highly affected by import restrictions on day old-chicks and hatching eggs as Russia depends on 15% of total hatching egg supply on imports mainly from these countries,” analysts say. “Although Russia is now re-opening imports of hatching eggs and day-old chicks from non-affected regions in these countries, a future supply risk for Russia will remain and any outbreak in Northwest Europe can affect future market conditions significantly especially if this happens in the Netherlands.”

Rabobank says Brazil is positioned to capture some of the US and EU export market shares to Russia.