Rabobank: Global poultry outlook to improve in H2 2020

Demand for poultry will be more bullish globally in the second half of the year as the Covid-19 containment measures on the restaurant and hospitality sectors are eased. But issues affecting Europe may mean that overall production on the Continent is lower this year, according to 2 reports released earlier this month.

Rabobank’s Quarter 3 study argues the outlook is gradually improving following the storm that hit the industry in the first half of the year and this is due to lifting demand through the foodservice sector, which will particularly benefit the breast meat sector. Rabobank analysts say poultry demand is expected to improve in the second half with the biggest driver the economic downturn, which makes global markets more volatile and price driven. Such conditions are generally positive for poultry, being the cheapest meat protein with a short and flexible production cycle.

Nan-Dirk Mulder, Rabobank Senior Analyst – Animal Protein, said: “Volatility could be exacerbated by ongoing challenges to balance supply and demand and by exchange rate instability. On the other hand, the relatively bearish feed price outlook will provide producers some relief on the cost side of their businesses.”