Industry should shape up to compete in EU market

The UK poultry industry needs to become more efficient if it is to compete in a consolidating EU market.

A new report from market analysts Rabobank says the current structure is not effective when it comes to competing with the powerful British supermarkets.

“Despite operating in one of the highest value-added markets in the EU, the UK poultry industry is suffering as a result of high feed prices, limited volume growth and oversupply,” it says.

Increases in domestic demand merely reflect population growth, while the UK’s export industry still underperforms by failing to capitalise on a strengthened competitive position, linked to the depreciation of sterling and new marketing standards for fresh poultry.

“Oversupply has placed retailers in the driving seat of the value chain,” says Rabobank. “Players without a preferred supplier relationship find themselves having to fight for retail tenders based on price alone, exacerbating the high levels of competition that arise from feed costs.”

In order to thrive the UK poultry industry must:

• increase consolidation levels to more closely match that of the retail sector

• increase efficiency in the supply chain and the rate of structural change

• improve supply discipline.

See more