The march of Ukraine's poultry producers into the
European Union, with plant openings in the Netherlands and Slovakia, is
seen extending into Germany, to help meet the bloc's continued growth in
The opening up of the EU poultry market has encouraged
Ukraine's poultry industry to invest in the bloc, besides sending exports
encouraged by a 2014 trade agreement.
Kiev-based MHP, notably, in partnership with Dutch
operator Jan Zandbergen, last year set up a processing plant in the Netherlands, a
key market for Ukrainian chicken.
Six months ago, MHP announced the opening of a Slovakian processing
facility, to where the company can truck chilled birds from Ukraine within
one day of slaughtering, according to US Department of Agriculture analysts.
Now Germany - with the Netherlands the other main
buyer of Ukrainian broiler meat, for use in the likes of sausages and
deli products – may be poised for a Ukrainian site.
"Industry analysts predict that Ukrainians will
purchase additional facilities in Germany," which will also be used to
process imported Ukrainian chickens, USDA staff in the EU said in a
The opening of EU plants - besides allowing Ukrainian processors
to tailor their output better to local markets, and label food as
produced in-country - will also enable groups to exploit unused import
While Ukrainian processor are expected to export
44,000 tonnes of broiler cuts to the EU this year, well above the
tariff-rate quota of 18,400 tonnes, much of the allowance for trade in full
birds is not being utilised.
"Ukrainian exporters who ship chilled broiler
carcasses for further processing in the EU are using more and more of the
20,000-tonne quota for whole birds," the report said.
The Ukrainian volumes are helping meet EU consumption
seen by USDA staff growing by 120,000 tonnes this year, to 11.17m tonnes,
and by a further 150,000 tonnes in 2018.
"The economic downturn in Europe has not negatively
impacted sales because broiler meat is less expensive than other types of
meat," the briefing said.
The EU will also next year see a return to growth in
exports, seen hitting 1.28m tonnes, after a fall of 25,000 tonnes to
1.25m tonnes this year, undermined by "plummeting" volumes to Saudi
Arabia, a decrease which "seems to be linked" to a dent to demand from
lower oil prices.
Ironically, Ukraine is fuelling this decline too, with
Saudi Arabia replacing some imports from more expensive origins, notably
France, with shipments from the former Soviet Union nation.
In Germany, a Ukrainian investor would enter a market which
is a net importer of broiler meat - unlike neighbouring Poland, which has
grown into the EU's largest producer, responsible for some 18% of the
Indeed, Germany production growth "has stopped because
welfare and environmental issues hamper the establishment of new poultry
farms and the enlargement of existing ones", the report said.
MHP in the Netherlands met some opposition too from
domestic poultry farmers over the opening of its Dutch processing
facility, in Veenendaal.