The Poultry and Egg Industry in South Africa 2023

Challenges

Adherence to health, safety, and environmental regulations, as well as meeting quality standards. Avian flu and other poultry disease outbreaks. Changing consumer preferences for healthier, ethically produced and environmentally sustainable poultry and eggs. Competition from imported poultry products, putting pressure on local producers to remain competitive, leading to trade disputes over tariffs and quotas. Economic factors such as inflation, unemployment and purchasing power influence consumer spending. Electricity and fuel costs. Extreme weather events and environmental concerns affect production and feed availability. Finding skilled labour, especially in health management. Intense competition within the industry, along with periods of overproduction, puts pressure on prices and reduced profitability for producers. Maintaining stringent biosecurity measures. Price volatility due to feed costs, competition and market demand, affecting both producers and consumers. Road conditions and logistics. Securing financing for expansion, technological upgrades and modernisation. Volatile feed prices.

Introduction

The poultry and egg industry is the largest contributor to the agricultural sector in South Africa. It is the second largest consumer of maize after human consumption, and supports many peripheral businesses. The industry is the primary supplier of quality, affordable protein to South Africans and there are over a million households engaged in some form of poultry production. The industry had been under pressure for a number of years following a severe drought and avian flu outbreaks. The most recent outbreak has seriously affected the operations of major poultry and egg producers, and is expected to lead to significant shortages and escalating prices. While local demand for poultry meat has steadily increased since 2008, there has been a growing presence of cheap imports.

Opportunities

Adaption of more sustainable and environmentally friendly products, through reduced waste, optimised feeding and renewable energy. Development of value-added poultry products for convenience-oriented consumers. Growing demand for free-range and organic chicken and eggs create diversification opportunities. Innovations in processing technology and packaging to improve shelf life, reduce waste and enhance product presentation. Potential to expand exports to neighbouring countries and international markets. Provision of biosecurity solutions to prevent and manage diseases. Provision of training and educational resources to assist new entrants. Research and development in poultry genetics, feed formulation and disease resistance. Technological integration, including data analytics, disease management and automation. Vertical integration.

Outlook

Continued margin pressure and rising input costs may result in consolidation, integration and concentration of market share. The recovery of consumer spending is critical to the industry’s outlook. The industry has called for tariff protection to achieve global cost competitiveness. High electricity, fuel and feed costs and power cuts have forced some producers to close. Major producers have warned that the avian flu outbreak will significantly affect production, supply, prices and their financial results.

Report Coverage

This report on the poultry and egg industry in South Africa provides a comprehensive overview of production, consumption, flock numbers, revenue and volumes, prices, diseases including the latest avian flu outbreak, notable players and influencing factors such as economic factors, power cuts and infrastructure issues. There are profiles of 23 companies including major producers such as Astral, RCL and Country Bird, egg producers such as TopLay Egg Co-operative and Eggbert Eggs, and companies in the ostrich industry such as Cape Karoo International.

Trends

Automation and technology adoption are becoming more prevalent. Challenges from imports of cheap poultry products and trade protectionism. Disease management. Government policies and plans to grow the industry, especially controlling imports and stimulating export growth. Growing trend of consumers seeking healthier and more ethically produced poultry and eggs. Increased focus on food safety and quality, driven by consumer demand and regulatory requirements. Some large commercial producers are expanding production capacity and improving infrastructure. Sustainable production practices, environmental concerns and impact of poultry production and waste management. Volatility of feed prices affects profitability.