Linked In
News In
Linked In

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

Germany 'next target' as Ukraine poultry industry expands in EU

Twitter Linkedin eCard

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 demand.

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.

Quota incentive

"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 report.

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 concessions.

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.

Demand growth

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.

'Welfare and environmental issues'

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 bloc's output.

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.

By Mike Verdin

Twitter Linkedin eCard
Related Stories

Evening markets: Ags outperform broader commodities for once, despite cocoa tumble

Agricultural commodities close higher overall, helped by the likes of corn, cotton and soymeal - but not wheat, which suffers after poor US export data

US corn export sales jump, cotton data reassure

... and soybean export sales too were ahead of forecasts last week. But wheat’s performance, again, disappoints, official data show

How opposing Argentine, EU forces are distorting oilseed markets

Soymeal futures have had a strong 2018 so far, thanks to Argentine dryness fears. But for vegetable oils, gains have elusive - leaving the likes of soybean and rapeseed markets pulled both ways

Evening markets: India helps cotton rise close to 8-month high, but spoils sugar market

... with ideas of a return by exports to India helping send white sugar prices to a two-year low. In grain markets, winter wheat outperforms spring
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© 2017 and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069