Global fears of a food crisis have prompted many countries to stockpile more food, including chicken products. On June 1, Malaysia suspended the export of chicken products, which severely affected its main trading partner, Singapore, and led to Singapore speeding up the search for new sources of imports. At the same time, war-torn Ukraine has also reduced exports of chicken products, causing its main importers, the European Union, the United Kingdom, Saudi Arabia and the United Arab Emirates, to find alternative sources of imports. The root cause of the above problems is the tight supply in the world market; moreover, the cost of upstream feed ingredients, energy and transportation, and the production cost of downstream products have all risen. The above situation presents an opportunity for Thailand , which is a major chicken producer and exporter in the world, to expand its exports to meet the needs of these markets.
In the second half of 2022, the export of Thai chicken products will continue to be driven by the gradual recovery of demand from trading partners, such as Japan and the European Union opening up of the country, exports to the UK benefiting from the trade agreement, and South Korea granting an export certificate to Thai chicken processing factories. Additionally, orders from new markets have increased such as Saudi Arabia looking for an alternative to Ukraine's import market and lifting the ban on imported chicken from Thailand, Singapore looking for an alternative to Malaysia's import market, and Malaysia increasing imports to make up for the domestic supply shortfall, etc.
Based on the above factors, KResearch predicts that the export value of Thai chicken products will reach US$3.51-3.6 billion in 2022, from a year-on-year contraction of 2.4% in 2021 to a year-on-year increase of 7.5-10.0%. However, Thai chicken exports still face many challenges, including economic trends and inflation in trading partners, transportation costs/freight rates are still high, labor shortages in manufacturing may limit production increases, and other countries may take additional domestic food security measures, and other factors that may affect the balance of global production and demand in the future such as the detection of H5N1/H3N8 avian influenza viruses in some countries. These factors may affect the production, export and domestic retail prices of chicken products in Thailand and should be closely watched.
Domestic chicken prices in Thailand are also inevitably affected by the global food crisis, including rising costs of raw materials such as soybean meal and corn, which are highly dependent on imports, especially as the baht tends to depreciate, while transportation costs have also increased with rising global oil prices. In addition, demand for chicken in the domestic market is still trending upward as pork production has yet to return to normal and production costs continue to rise due to labor shortages in the manufacturing sector. KResearch predicts that the average retail price of domestic chicken (fresh whole chicken with guts) will be THB 70-73/Kg in 2022, up 12-17 percent from the 2021 average of THB 62.15/kg. Growth in domestic chicken consumption is expected to be limited as chicken prices remain high and rising inflation affects consumers’ purchasing decisions.
According to data from the United States Department of Agriculture (USDA) in April 2022, Thailand is the world's sixth largest chicken producer (the world's major producers are Brazil, China, the European Union, Russia, Mexico and Thailand) and the world's third largest chicken exporter (The world's major exporters are Brazil, the European Union and Thailand).
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