China’s Year of the Rooster to see a serious chicken meat shortage

As China ushers in the Lunar New Year, poultry prices have dropped unexpectedly during the peak holiday season for chicken meat consumption. While that’s a boon for Chinese consumers in the short term, analysts forecast the country will experience its worst chicken shortage in decades in the Year of the Rooster.

That’s because the knock-on effects of a two-year ban on US imports of breeding stock will soon be felt in the market, threatening supplies of the meat in the world’s No 2 poultry market and pushing prices up in the second half.

However, over the past month prices of white feather broilers, the major type of meat chicken in China, have been falling during what is the peak season for consumption, according to recent data from tech-food.com, a food industry information website.

“The unexpected drop in prices is mainly due to a concentrated supply of broilers before the holidays, as farmers offered too much meat chicken to the market,” said Chen Jiao, an agricultural analyst for brokerage Industrial Securities.

“The current supplies at farms are still at high level [as] it still takes some time for the market to digest all of them,” she said.

However, analysts expect supplies of white feather broilers to shrink sharply in the second half of 2017, which will push chicken prices significantly higher in the third quarter.

“China will have a chicken shortage in the Year of the Rooster,” analysts from Citic Securities said in a research report.