Outlook for livestock industry 2021

Experiencing a turbulent year in 2020, the global protein products market in 2021 is at risk of facing many potential risks but is also ready to accept new opportunities.

Production growth
Although the livestock industry in 2020 still recorded quite positive growth in output, according to a report by RaboResearch and the US Department of Agriculture (USDA), supply chain disruptions are expected to continue throughout early 2021. Due to disruptions in the beef processing industry, US beef slaughter in 2021 is forecast to reach its highest level since 2010, up 4.6% year-on-year to 26.6 million head. Meanwhile, world beef production will increase 2% to 61.5 million tons as the global economy recovers, consumption increases and supply chains recover from the pandemic. Even so, the forecasted production level in 2021 is still lower than the pre-pandemic level in 2019. Not only growth in output, global beef exports will increase by 3% in 2021. Economic conditions are improved. The recovery of the food service market is expected to be a lever for beef consumption. USDA forecasts that beef consumption in Asia will continue to be strong, helping to increase exports from the US and Brazil throughout 2021. In which, beef imports from China in 2021 will increase by 4%.

USDA also forecasts pork production in 2021 to increase thanks to the recovery from African Swine Fever (ASF) and Covid-19. However, the demand for pork consumption from China will decrease by 6% and the US pork production will only increase slightly because China's pork production in 2021 is expected to increase by 9% thanks to the efforts of producers to re-herd. produce and take advantage of high pork prices. The recovery from ASF also spurred an increase in pork production in Vietnam and the Philippines, although continued outbreaks in the Philippines could hamper efforts to revive the country's hog herd. In Europe, pork production and growth are expected to be stable. The discovery of ASF in the wild boar herd in Germany did not have a direct impact on production but limited exports, causing pork stocks in this country to increase in the context of the saturated European pork market. However, this is the factor that will help cool down pork prices in 2021. In Brazil, pork production is expected to increase by 4% due to a rebound in domestic pork consumption and stable export demand.

Global pork exports are unchanged at 10.8 million tons in 2021. Pork demand is expected to recover strongly after Covid-19 thanks to improved economic conditions and a recovery in the bloc. restaurant and food service. RaboResearch forecasts a growth rate of pig production in North America of 1.6% in 2021 thanks to two factors of the US and Canada.

Higher feed costs will weigh on poultry industry profits in 2021. Still, USDA forecasts poultry meat production to grow 2% in 2021 to 102.9 million tonnes. In 2020, US industrial chicken production increased by 1.8% but profits did not grow as expected and higher feed prices will limit poultry production growth in the first half of 2021. Still, meat Poultry remains popular thanks to its reasonable price and high nutritional quality.

Challenge and opportunity
The livestock industry in 2021 will continue to face similar challenges in 2020. According to the latest report of RaboResearch's 2021 food and agribusiness analysts, the key issues of the livestock industry Farming in 2021 will continue to revolve around ASF, rising feed prices, and the trend of increasing government intervention in many countries in areas of the livestock industry. The ongoing challenges surrounding the post-Covid-19 recovery will be at the forefront of many countries. At the same time, factors in the food service industry that will control the trend of the livestock products market at least the first half of 2021 are also issues to be noticed.

Annual meetings or conferences are also places where a lot of meat products are consumed, especially beef consumption will be drastically reduced after the above events are canceled or postponed to prevent Covid-19. Usually, the end of the year or the beginning of the new year is the occasion for many large-scale conferences and seminars. However, from 2020, most of those events have been moved to online meetings or postponed. The butcher industry has also lost a major consumer base, because meals for conferences of this size are worth many dollars with meat mains.

Questions about the extent of the recovery of the global livestock industry are really difficult to say with certainty while the whole world has to go through a tumultuous 2020 with travel bans, blockades, curfews, even Unemployment is everywhere. According to experts at RaboResearch, it takes about 2 years for the economy to really get back on track. During previous great recessions, it took the foodservice industry more than two and a half years to get back to business. However, the livestock industry in 2021 still recorded a certain recovery, and this will be the driving force behind the consumption of meat products throughout 2021.