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STRATEGY ▶▶▶


Egg prices in the EU have stayed at a solid, rela- tively high level but, Mulder warned, the fu- ture was not so bright due to an oversupply in the market and rising global feed prices.


PHOTO: RONALD HISSINK


of the pork industry from ASF, after two very bleak years for the sector. The Chinese have invested heavily in a very mod- ern infrastructure and production will impact global animal protein markets as well as the domestic Chinese egg sector which had benefitted over the past two years.


Over optimistic Looking at the slightly longer-term outlook, the pandemic pressures will still be present in 2021, in spite of optimistic vaccine efficacy rates of 90-95%. It will take time to distribute the vaccine globally and Mulder pointed to a recent Interna- tional Monetary Fund (IMF) economic outlook which may be over-optimistic as it hadn’t taken into account the strength of the second wave. The study shows a global GDP fall of 4.4% this year with a 5.2% bounce back in 2021, which will be es- pecially strong in China (+8.2%) and among the Association of Southeast Asian Nations (ASEAN) (+6.9%).


Avian influenza A highly pathogenic avian influenza was also spreading quickly in the northern hemisphere at the end of 2020, nota- bly in Russia, the EU/UK and Japan, and was likely to have an impact on markets in terms of disruption in the trade of day- old chicks and hatching eggs, the trade of eggs and egg products, as well as local supply issues With markets highly volatile and price driven, disciplined supply growth was needed to keep prices at a stable level: “Oversupply will kill the industry,” he stressed. Turning to the post-Covid era, Nan-Dirk Mulder talked about changing investment themes for the industry. He felt there would be three main themes: accelerated global growth in egg demand, a more consolidated and international sector and social concern-driven change, especially, but not limited


38 ▶ POULTRY WORLD | No. 1, 2021


to, Western European markets. Post 2021-2030 production growth would see developing countries, such as India, Paki- stan, Bangladesh and Myanmar grow fastest at more than 5% per year. Fast growth of 3-5% would be seen in Far East na- tions, such as Indonesia, Malaysia and the Philippines, as well as Colombia, Nigeria and Turkey. The key egg producing nations of China and the US will see slower growth of 1-3%, alongside Mexico, Brazil, Thailand, Canada and South Africa, while mature nations (the EU, Japan, Russia and Ukraine) may only see rises of 0-1%. Global markets will gradually follow Western Europe and shift to- wards a higher proportion of cage-free hens. At present, the EU has a 45%/30%/25% split between enriched, barn and free-range birds, while Latin and Central American birds are all housed in traditional cages. Drivers for change are most likely to come from companies keen on product differentia- tion as well as government regulation, with a push from cus- tomers. But the drive towards increasingly value-added prod- ucts will be mostly from developed countries, while emerging markets will stick to conventional housing before moving to enriched cages in the years to come.


Optimising strategy Another key area of change will be around remote working for staff which will change egg markets forever, he said. This impact on food distribution and poultry demand will see su- permarkets, online and specialist stores boom while to-go markets, the catering sector, lunchrooms and after work res- taurants will suffer. More premium product online options will lead to a breakthrough in digital value chains. The egg sector will perform well as long as the industry constantly op- timises its strategy, he concluded to an online audience of nearly 200 IEC members.


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