by SUSAN MANN
Chicken is poised to take over from pork in the next 10 years as consumers’ most popular meat selection around the world, according to a new international agricultural outlook report.
However in China, the world’s largest producer and consumer of pork, that meat will remain consumers’ number one choice, says James Bryan, senior agricultural economist with Farm Credit Canada. He was commenting on the OECD-FAO Agricultural Outlook 2014-2023 report, prepared by the Organization for Economic Co-operation and Development (OECD) and the Food and Agriculture Organization (FAO) of the United Nations.
“The transition towards chicken is largely in developing countries because it’s a lot easier to raise than pork in a more urban environment and its cheaper,” he explains. In developed countries, such as Canada and the United States, chicken is cheaper to raise and sell compared to pork and “it’s perceived as healthier than alternatives like beef.”
Bryan says chicken is still “quite a bit behind” pork currently as the world’s most popular meat preference. He didn’t know the exact year in the next 10 years when chicken would take over the top spot.
The factors driving the overall demand of farm products during the next 10 years will continue to be the same factors driving demand during the past 10 years, he says. Those factors include rising populations, increasing incomes in developing countries and urbanization. It’s those same factors that will continue increasing farm product demand, particularly for meats. “But the rate of growth in demand is going to be slower for the next 10 years compared to the last 10 years” largely due to a slowing population growth, Bryan says, adding worldwide population is projected to plateau in 2015.
As for prices, beef and pork prices are projected to “remain relatively steady compared to the last two years,” he says. “The good news for hog and cattle producers is crop prices are supposed to remain much lower than their highs from 2008 to 2013 so that’s really good for the profitability of those two sectors.”
The report notes “crop prices are expected to drop for one or two more years before stabilizing at levels that remain above the pre-2008 period but significantly below recent peaks.”
The report also says livestock and biofuel production are projected to grow at higher rates than crop production in the next decade. “This changing structure of global agricultural production prompts a relative shift towards coarse grains and oilseeds to meet demand for food, feed and biofuel away from staple food crops, like wheat and rice,” the report says.
Most of the additional production will come from regions where land and water availability along with policy regulations are “the least constraining,” according to the report.
Bryan says there are lots of these types of reports that come out every year from various organizations. “One of the best things to do as a producer is to look at their price forecasts and their outlook” and use them to judge the profitability of their own business and determine whether their business needs adaptations. Even though lots of things can change and that throws the forecasts off, he says “it’s one tool you can use to plan your business. But it’s not the only one.” BF