Oversupply a concern for Welsh poultry sector

Caution urged around growth in Welsh poultry sector despite strong demand
Caution urged around growth in Welsh poultry sector despite strong demand

Wales’ egg and poultry producers have a strong future with market trends pointing towards strengthening consumption, but an increasing supply is a source of concern for some.

Consumer demand for eggs and poultry meat have risen steadily over the past 10 years.

This is the result of consumers choosing to include more protein in their diets, with growth largely driven by chicken.

Nathan Ward, analyst at market research company Kantar, said people are buying more chicken than ever before.



“Eighty per cent of all growth in protein sales last year was driven by chicken, it is becoming a big part of the repertoire of the food people are choosing to buy,” he said.

For the organic poultry sector, growth had not been as strong as it had been in the conventional market.



Although sales of organic chicken had grown by 65% in the last five years, within the poultry meat sector overall this is only equivalent to 1.3% of volume growth.

Meanwhile, data shows that free-range egg consumption has risen by 5-6% a year for the past four or five years. Forecasts suggest demand will continue to grow.

“As a nation we love eggs, people want foods that are a quick, easy fix and eggs deliver that,” said Mr Ward.

“Chicken and eggs are winning the battle on how they are used, they have a great story to tell. There are a lot of positive things going for the future of eggs and poultry”

But increasing supply is a source of concern for some.

The danger of oversupply

Richard Jones, who produces eggs near Newtown, said diversification into egg production had been the wrong decision for some due to oversupply which had pushed down prices in the free range egg sector.



“A lot of people have come in and found it is not working for them because there is an oversupply,” he said.

The Welsh government's Farming Connect programme explain that their support can help prepare a business plan and allow farmers to make informed decisions on diversification into this sector.

There are currently 714 poultry farmers and 321 poultry businesses registered with Farming Connect.

Mr Ward, who recently spoke at a Farming Connect event, emphasised the need for producers in all sectors to understand the requirements of their buyers, such as current demand for large eggs.

He said a reason for this demand was that eggs are being used more for main meals.

“As producers you have to work with retailers to understand the ‘why’ behind the ‘what’,” he advised.

Mr Hughes highlighted the value of having a strong brand and the need to be aware of any opportunities for eggs and poultry produced in Wales to capitalise on provenance through the ‘Welsh story’.

“Perhaps there is an opportunity to develop a Welsh brand and tap into the premium market,” he said.

Mr Ward said provenance in combination with the right product does drive value but he emphasised the need for a co-ordinated approach in targeting the right markets.