Growing wholesale chicken prices can be offset by increased purchases of pork

In the 20th week (May 15-21) of 2023, the wholesale price of a chicken carcass increased by 1% per week and by 17% year-on-year to 160 rubles per kilogram. Chicken wing and fillet last week went up by 3% (both positions) - up to 180 and 265 rubles per kilogram, respectively.

Analysts at AD Libitum note that such price dynamics cannot be considered as a seasonal phenomenon, and it is difficult to predict stabilization. Previously, the price of chicken MEAT decreased immediately after the holidays. 

This year, broiler carcasses are more expensive than comparable positions in the pig product range. Pork continues to get cheaper. The wholesale price of half-carcasses, hams and shoulder blades fell 1% last week to 154 rubles, 230 rubles and 223 rubles per kilogram, respectively.

Andrey Sokolov, senior partner of AD Libitum, explains the dynamics of prices in the pork market by growth in exports: as the ruble depreciates, Russian pig products become more attractive. In the period from the end of 2022 to May 19 of this year, the DOLLAR exchange rate increased from 70.3 to 80 rubles. The Central Bank expects inflation to accelerate.

For external deliveries, Vedomosti cites statistics from the EMEAT analytical agency: in January 2023, the volume of poultry exports to non-CIS countries amounted to 16.5 thousand tons, in February - 18.7 thousand tons against 17.1 thousand tons and 20.4 thousand tons in January-February 2022. Deliveries increased every month, and in March, according to the National Union of Poultry Breeders (NSP), their volume exceeded last year: 24.479 thousand tons against 22.825 thousand tons. Due to shipping to foreign markets, large exporters reduce supply on the domestic market and keep prices from falling, Andrey Sokolov explains.

Last year, the first places in the ranking of exporters of chicken meat were taken by SUE "Resurs" and "Cherkizovo". They accounted for 62% of the total supply. A Cherkizovo spokesman said that exports have more of an impact on the cost of breast fillets and wings than on the cost of a whole carcass. In the first quarter of 2023, the holding increased shipments abroad by 15% due to CHINA , Vietnam and post-Soviet countries. 

The Executive DIRECTOR of the National Meat Association (NMA), Sergei Yushin, specified that the situation when broiler carcasses become more expensive than pork at the moment indicates a rapid increase in the production of the second type of meat in agricultural organizations. According to Rosstat, in January-April, the volume of pork output increased by 6.3% yoy (up to 1.7 million tons), and poultry - by 2.4% (up to 2.1 million tons). 

With the closed markets of China and Japan, there is internal pressure, the HEAD of the NMA added. Unlike half-carcasses, a whole broiler carcass is a popular traffic-generating product in retail, so chains sell it at a minimal markup, and sometimes at prices below purchase prices, which supports demand that stimulates a rise in chicken prices.

Another reason for the unusual price dynamics in the poultry market, according to Andrey Sokolov, may be the shortage of spare parts and components with the departure of a number of large suppliers from RUSSIA. Sergei Yushin suggests that the situation may return to normal with a shift in the demand of meat processors for pork and an increase in its share in recipes. Both experts characterize the situation as short-term.