A complete programme of expert talks and workshops offered to the visitors in the two–day event opened with an overview on ‘Outlook for the Poultry and Egg Sectors’.

Kelly Watson, Chief Poultry Advisor in NFU, chaired the session in which John Reed (Chairman of the British Poultry Council and Agriculture Director of Cargill Meats Europe) and Peter Thornton (CEO of egg company, Noble Foods), gave their predictions for the poultry and meat and egg sectors in the future.

During her introduction, Ms Watson talked about the challenges for the food industry due to the increase of world population. One of these is the supply of affordable and sustainable animal proteins to feed the growing global human population.

She raised the question about the acceptance of large–scale farming by the general population, pointing out that sustainable intensification is a real concept for the poultry industry.

She also mentioned the impact of feed prices in the industry due to the Euro crisis, among other factors, and the influence that China will have, following the 26 per cent increase in its soybean purchases last year.

Outlook for the Poultry Meat Industry

In his analysis of the future challenges for the poultry meat industry, John Reed pointed out that the average weight in chickens has decreased since 2007. To him, the growing demand for products from fast–food services has reduced chicken weight as this sector demands are different from other traditional industries, such as retailers.

The trend for exports is low value items whereas the UK consumers’ preference is for white meat (breast).

Imports are coming from Brazil but the EU quota system limits the volumes. However, the lifting of the ban on imports of raw poultry meat imports from Thailand to the EU from July this year is expected to lead a higher amount of products coming in.

According to Mr Reed, chicken volume sales went up in comparison to other animal proteins like fish and lamb as the economic difficulties of many households have worsened.

Regarding prices, the price in all proteins saw a 51p/kg increase last year.

In the UK, there is also a general concern about animal welfare and sustainability among consumers. The product provenance (mainly, British and local production) as well as the value (labelled value products emphasising quality) are important factors for them as well.

Overall, chicken volume sales are rising. By categories, free range and organic production and going down due to people's preference shifting towards standard and valued meat when their household budgets are under pressure. At the other end of the market, consumers moved from breast to the whole bird as well.

To sum up, Mr Reed emphasised the fact that poultry market is in growth and it is expected to continue growing at least in the next two periods. The turkey sector is showing signs of improvement but duck producers are still under pressure at the moment.

He also talked about two important challenges in poultry meat production: Campylobacter and antibiotic usage.

The UK poultry industry has managed to bring Salmonella under control but Campylobacter needs a different way to be tackled, he said. The industry is trying to reduce the Campylobacter levels and there is a big pressure about it at the moment.

Regarding antibiotic usage, he pointed out the importance of taking a proactive way to reduction due to the link with resistance to antibiotics in humans.

Mr Reed concluded by saying that there is optimism for the future in the industry since it is well organised and well structured. He added that it is important to demonstrate on farms that the standards society wants regarding food security can be achieved.

Outlook for the Egg Sector

Peter Thornton gave some projections on the future for the egg sector in the UK, starting by emphasising how well the industry has managed to reduced Salmonella levels over recent years to an outstanding 0.15 per cent positives. This is much lower than other EU countries; for example, in 2010, Spain recorded 6.5 per cent Salmonella–positive eggs.

Per-capita egg consumption in the UK has risen by 10 per cent over recent years but it still has some way to go to reach the EU average, offering the industry potential for growth.

He acknowledged the British Lion Eggs active promotion of the benefits derived from eating eggs, demystifying the risk of increasing cholesterol levels due to their consumption and helping consumers to understand their benefits. As a result, there has been an increase in the number of people who consume more than three eggs per week.

A hot issue for the industry at the moment is the application of the EU Directive to ban unenriched cages for laying hens, according to Mr Thornton.

He said that politicians have not protected poultry producers as much as they promised and some countries within the EU still have not updated all their facilities.

This meant egg prices went up during the first months of this year and it also caused a shortage in the egg supply across all the European Union.

‘Illegal eggs’ produced in battery cages have been used legally in the food industry. However, in July 2012, this will be banned as well, and Mr Thornton believes this will be a crucial moment for the industry.

Regarding the retailers, he reported a strong trend to sell products in promotion; 40 per cent of food products sold are on some sort of offer or promotion. In addition, he said the sector is facing its toughest challenges for 25 years.

In the last six months, free-range and organic eggs have lost market share against caged eggs in sales at the major UK retailers. Because of the large price differential, consumers are shifting purchasing from free–range or organic eggs to ‘value’ eggs. Moreover, some food–service providers have begun to buy eggs from retailers because they can get cheaper deals there than from wholesalers.

Regarding the pricing, he expressed the importance of new producer contracts to reflect these current market developments and the fact that free-range egg prices are unlikely to return to the profitability experienced between 2000 and 2010. Over-supply in this sector has eroded the premium as free-range eggs have been sold in the value market.

While there is a prospect of improved prices for cage eggs, Mr Thornton said that the producer association, BFREPA, and the egg packers need to work together to re–balance the free-range market.