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Chicken consumption to increase 1.1% here if nz consumers consumption does not increase ;inline with pop growth but 15% in south east asia over the next 5 years
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Yes the consumption of chicken is expected to significantly increase as the emerging market SEA middle class demand more protein as they did and have in China.
Some observations:
- These markets have traditionally consumed fresh chicken (as opposed to frozen or even chilled chicken);
- The labour costs for processing in these markets are a lot lower than New Zealand;
- Freight, logistics, warehousing and distribution adds even more cost for a NZ based grower/processor to sell into these emerging markets;
- Yum Brands who are one of the largest purchasers in China (for their KFC operation) sourced their chicken from local suppliers (albeit with some issues eg http://fortune.com/2013/05/09/yum-br...bles-in-china/) so why would these emerging SEA markets decide to chose a relatively high cost base imported chicken rather than setting up their own growing and processing arms?
- On the other hand, if a NZ domestic producer could differentiate itself as a high quality producer (such as where NZ sourced infant formula is perceived in China) then it could see some uplift but it presumes that the incomes in those markets will rise enough to create a market big enough.
Summary - yes folk in the SEA region will consume more chicken but why would they want it from here unless it was for the high end market?
Far too early to make any solid certain comment in the short history of TGL except to say we have shot above the 5 and 10DMA:mellow: and that our first chickens are 3 weeks old and already plumping up.