Asian Meat Market has been showing a bearish sentiment in 2024

Analysts at Procurement Resource say that the general meat market and price trend across the Asian region leaned toward declining or stabilizing prices due to oversupply and shifting market dynamics. Though there were sporadic rises in some parts, they were short-lived.  The meat market in Asia has been primarily marked by Brazil and Australia expanding exports to fill gaps as other regions face constraints. High volatility from environmental, economic, and political factors affects trade. Rising consumer demand for affordable chicken and lower-cost beef cuts drives supply chain adjustments. Oversupply in China’s hog market kept prices down despite government intervention, with an 8% decline in pork production by August. Brazil leads chicken and beef exports, while Japan and the UAE rely on imports. Australia’s 90CL beef prices surged mid-year due to US demand but fell after US price drops and port strikes. Let’s delve deeper into the insights!

Asian Meat Market Dynamics

Economic and geopolitical factors are reshaping supply-demand dynamics across meat market, particularly in the chicken and beef markets. Brazil and Australia are expanding exports to fill global market gaps, responding to shifts in demand as other regions face production constraints. Market volatility remains high, influenced by environmental challenges, economic pressures, and political developments, prompting producers and buyers to adopt agile strategies to navigate changing pricing and trade patterns. At the same time, consumer preferences are increasingly leaning toward affordable protein sources, driving demand for versatile, lower-cost meat cuts. This shift is reshaping supply chains, as producers capitalize on the growing appeal of budget-friendly options to meet evolving consumer needs.

Spot Hog Price Volatility

High slaughter numbers in 2023 created an oversupply, driving hog prices down significantly. In response, the Chinese government issued guidelines in March 2024 to stabilize the sow population and manage price fluctuations. After August, bearish sentiment dominated as oversupply continued, prompting secondary fattening—a process where hogs are fed a high-energy diet to achieve market-preferred weight and meat quality. However, even this strategy couldn’t fully counter the supply surplus, keeping prices under pressure.

Reduced Slaughter Rates in Chinese Pork Production

By August 2024, Chinese pork production saw an 8% year-over-year decline in slaughter numbers, totaling 24.4 million heads. The sow herd remained steady at approximately 40.36 million heads, slightly exceeding government targets, which added to bearish market sentiment due to the risk of ongoing oversupply issues.

North Asia Corn Prices and Trade Volatility

Corn prices in North Asia have shown reduced volatility in 2024 compared to previous years, as economic pressures and hand-to-mouth buying practices kept purchases cautious. Buyers avoided building large inventories, responding to disease impacts, Brazilian floods, and logistical challenges by purchasing conservatively.

Geopolitical and Environmental Influence on Feed Demand

China’s reduced soymeal demand and weaker domestic consumption are exerting downward pressure on prices. At the same time, environmental and geopolitical factors—such as soil moisture issues in Brazil, logistical bottlenecks in the US, and rising conflicts—are creating potential upward pressure. Additional swing factors like Chinese economic stimulus and the outcomes of the US elections are contributing to uncertainty.

Broiler Meat Demand Surge in Asia

Chicken (broiler) meat demand is projected to grow over 11% by 2030 as consumers increasingly opt for affordable, healthier proteins. Chicken’s widespread cultural acceptance in Asia, along with its lower fat and higher protein profile, has cemented its popularity. The shift away from red meat reflects both health considerations and economic choices among Asian consumers.

Leading Global Chicken Exporters

Brazil dominates the global chicken export market, with a forecasted 3.3% increase in 2024 due to expanded production and competitive pricing. In contrast, the US is expected to experience a 9% decline in exports, affected by competitiveness issues, outbreaks of High Pathogenic Avian Influenza (HPAI), and decreasing demand from China.

Major Chicken Meat Importers: Japan and the UAE

Japan remains one of the top chicken importers, with expected growth in 2024 driven by food service sector expansion and consumer demand for affordable meat. Meanwhile, the UAE heavily relies on imports, particularly from Brazil, due to limited local production capacity, highlighting its dependency on international suppliers.

Japan’s Frozen Chicken Import Preferences

Japan’s frozen chicken imports from Brazil are highly specialized, with boneless legs making up 93% of total imports. This focus aligns with Japan’s culinary demand, emphasizing particular cuts suited to its market.

Dynamics in North Asian Chicken Leg Demand

In mid-2024, Japanese imports of chicken legs surged, creating high inventory levels and a subsequent price drop of 13.5% from July to October. Retail data suggest chicken prices will continue to decline through 2024, while beef prices strengthen due to higher demand and consumer price sensitivity across protein types.

Leading Beef Importers: China and the US

China, accounting for 34.7% of global beef imports, is increasingly favoring lower-priced cuts due to economic constraints. The US, with a 16.4% share of global imports, is actively building its inventory to address domestic shortages, leading to a 17.6% forecasted increase in imports in 2024.

Global Beef Export Landscape: Brazil and Australia

Brazil remains the largest beef exporter, with a projected 23.4% increase in 2024 as production rises to meet robust demand. Australia, filling the gaps left by reduced US exports, anticipates a 19.6% boost in its exports, capitalizing on increased demand and competitive pricing amid global supply constraints.

Australia’s 90CL Beef Price Trends

Australia’s 90CL beef prices, essential for US ground beef production, rose by 11% to $8325/mt in mid-July 2024 due to strong US demand. However, prices declined to $6551/mt by October as US lean beef prices fell, reducing demand for imports. Additionally, the US port strikes in October limited trading, impacting Australian beef exports.

Demand for Lower-Cost Beef Cuts

As economic pressures mount, consumers are increasingly opting for affordable beef cuts like chuck and brisket, which are suited for slow-cooking methods. This shift not only caters to budget-conscious consumers but also enhances sustainability by utilizing more of each animal. Globally, the trend toward lower-priced cuts has optimized production strategies, appealing to regions sensitive to protein costs.

Conclusively, in 2024, APAC meat prices showed mixed trends. Hog prices in China trended downward throughout the year due to an oversupply, despite government efforts in March to stabilize the market. Chicken prices in North Asia, particularly in Japan, experienced a 13.5% decline from July to October, driven by high inventory levels and cautious consumer demand. In the beef sector, Australia's 90CL beef prices initially rose by 11% to $8325/mt by mid-July, fueled by strong US demand and limited domestic supply. However, these prices fell to $6551/mt by October as US lean beef prices dropped, coupled with disruptions from port strikes that affected trading. Overall, the meat market trend majorly saw a declining trend in Asia in 2024.