21 Jun 2019

Over-supply in the welsh poultry sector causing concern

With consumption on the rise, the Welsh poultry sector has a bright future ahead. However, over-supply is an increasing cause for concern among producers.

With consumers choosing to include more protein in their diets, demand for eggs and poultry meat have risen steadily over the past 10 years.

Nathan Ward, analyst at market research company Kantar, said people are buying more chicken than ever before. “80% of all growth in protein sales last year was driven by chicken,” he said.

But the organic poultry sector has not seen the same strong growth at the conventional market. Although sales of organic chicken had grown by 65% in the last five years, within the overall poultry meat sector this is only equivalent to 1.3% of volume growth.

Meanwhile, data shows that free-range egg consumption has risen by 5-6% a year for the past four or five years, and forecasts suggest demand will continue to grow.

A positive result for the industry but increasing supply is a source of concern for some.

The problem with over-supply

In recent years several farmers have diversified into egg production, but the over-supply has pushed down prices in the free-range egg sector.

A recent Farming Connect event, titled ‘future-proofing your business’ emphasised the importance of farmers preparing a comprehensive business plan in order to make an informed decision and help identify wider opportunities before diversifying into this sector. 

See also: Writing a business plan

Mr Ward, who spoke at the event highlighted the need for producers in all sectors to understand the requirements of their buyers, such as the current demand for large eggs, in order to secure a ready, viable outlet with set specifications that can continue to be met.

“As producers, you have to work with retailers to understand the ‘why’ behind the ‘what’,” said Mr Ward.

To find out more about what was said at the event, click here.

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