Market Trends of kuwait poultry meat Industry
Increased domestic poultry production is driving the market growth
- Poultry production accounted for the fourth highest share of 7.4% by value of total meat production in the country. However, in order to meet consumer demand, the country still depends more on imports, due to which around 0.13 million tons of poultry meat was imported in 2022. Due to high import prices and increasing demand for fresh/chilled poultry meat, the government is investing in increasing domestic production. The government is also taking initiatives to increase domestic poultry production, as the rate of domestic consumption has expanded and is expected to grow gradually in the upcoming years, thus creating an opportunity for international poultry producers to enter the market.
- In 2022, there were 25 poultry production companies in Kuwait, including six major companies in this field. Collectively, they produced 35,000 metric tons of frozen, fresh, and live chicken annually, covering 30% of the local market’s needs. The poultry crisis is looming on the horizon after the rise in feed prices globally. The government is expected to either offer subsidies to poultry and meat producers to face those conditions or allow them to raise prices to cover their losses and preserve the local production of poultry.
- Also, as the country is highly dependent on the import of poultry meat, various outbreaks of pathogenic diseases in foreign markets also affect the domestic market. In September 2022, Kuwait’s Ministry of Commerce and Industry issued administrative decree number 1895 - adopting a regionalization model to the county level for the US outbreaks of Highly Pathogenic Avian influenza (HPAI). The decree lifted a previous ban on all non-heat-treated poultry meat (fresh, chilled, frozen, and processed) and other poultry products from 24 US states.
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Rising production costs are impacting poultry prices
- Poultry meat prices in Kuwait are primarily driven by increasing poultry production and imports. The country's climate also plays a major part in affecting the poultry meat prices in the country. Chicken meat is popular in Kuwait and constitutes a major dish in daily diets. Due to the high demand for poultry meat and eggs, the government has granted assistance to poultry producers by providing them with feed and land subsidies, in addition to some veterinary services. The price of poultry meat in Kuwait was observed to have increased by 1.94% from 2021 to 2022.
- Feed constitutes a major cost for poultry producers in Kuwait. Most of the feed ration ingredients are imported from other countries. This represents a challenge for local producers in terms of fluctuating prices and quality, but subsidy programs significantly affect the industry. Corn, an important ingredient in chicken feed, was imported with a worth of USD 27.2 million by the country in 2021. However, the government-owned Kuwait Flour Mills Company sells imported corn to farmers at a subsidized price, easing the ingredient procurement process for small and mid-scale producers. Other ingredients, such as soybean meal, concentrates, and pre-mixes, are imported by private companies and sold to poultry farms at market rates.
- Although the expansion of the poultry farming industry is a source of optimism for market participants, it poses some obstacles to the country's chicken meat output. Because of its arid environment and low rainfall, Kuwait is unsuitable for most sorts of agriculture. The average annual rainfall is roughly 112 mm/year and ranges from 75 to 150 mm/year. Clinical studies have revealed that a hot, arid climate can limit grilled chicken production and increase carcass shrinkage following chilling.
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