Rabobank report reveals future dynamics of global animal protein markets

In a recent report released by Rabobank, significant insights into the future of global animal protein markets have been detailed, particularly focusing on the year 2025. The findings highlight the multifaceted influences that economic conditions, geopolitical factors, and supply availability may have on the industry.

The data presented in the report suggests that seafood is projected to overtake poultry as the primary contributor to global protein supply growth, marking a notable shift in the market dynamics of animal protein. Angus Gidley-Baird, Senior Analyst – Animal Protein for RaboResearch, noted, “Overall production is set to grow slightly faster than in 2024, driven by aquaculture, wild catch, and poultry.” The analysis indicates that production levels are likely to establish a turning point, with aquaculture and wild catch experiencing a predicted growth of 2.3% year-on-year, rebounding from a 0.3% decline in 2024.

The report outlines the projected trends across various animal protein categories. Seafood and pork appear set to emerge from past contractions into phases of growth, whereas beef production is expected to decline, moving from a previous growth phase into contraction. Notably, poultry production is on a steady upward trajectory, albeit with certain productivity challenges that may temper growth.

Within specific geographical contexts, Gidley-Baird elaborated that Brazil may see a 1% contraction in terrestrial species production, while the European Union, North America, and Southeast Asia are likely to experience slower growth rates. China, however, is expected to see minor growth following a difficult 2024. The report also highlights that pork production in Southeast Asia will recover gradually, challenged persistently by African swine fever, while global pork production overall will only increase marginally (0.1%), a contrast to the significant growth observed from 2021 to 2023.

The agility of animal protein producers also hinges on government policies and macroeconomic conditions, which may introduce protectionist measures such as tariffs, raising trade costs. Such shifts could exacerbate shipping and freight disruptions arising from ongoing military conflicts, consequently increasing market volatility. The report notes that while inflationary pressures have begun to ease, further policy decisions are capable of reversing this trend, potentially diminishing consumer demand if wage growth does not keep pace with living costs.

With the persistence of animal diseases posing ongoing challenges, the agricultural industry is expected to increasingly employ innovative solutions such as advanced vaccines and artificial intelligence. These technologies will play a critical role in better managing and sustaining animal health amidst the regulatory changes and environmental pressures.

The report also underscores the importance of sustainability, with companies urged to prepare for evolving data collection practices and reporting guidelines. Strategic risks tied to climate, regulatory changes, and nature-related pressures continue to shape the operational landscape for animal protein suppliers across the globe.

The analysis of key regional markets reveals distinct trends:

• North America: While beef production will experience a decline, demand is expected to hold steady. Modest increases in pork production are anticipated, attributed to heavier weights, with poultry production also forecasted to grow despite productivity obstacles.

• Brazil: The beef supply is likely to drop as producers retain female cattle, changing the production landscape after three years of increases. Competitive pricing for pork and poultry may bolster supplies in these sectors.

• Southeast Asia: Pork production is projected to recover slowly, hampered by the lasting effects of African swine fever, whereas the poultry sector is regaining profitability and returning to previous growth levels.

• Australia and New Zealand: Australia faces a slight decrease in lamb production, while New Zealand is set for declines in both beef and sheepmeat supply.

• China: The forecast indicates slow growth in pork production, alongside a decline in beef production, which may encourage a price increase in this segment. Poultry supply is expected to remain sufficient.

• Europe: A contraction in pork production is anticipated, stemming from smaller sow herds, while beef production will continue its downward trajectory. In contrast, poultry production is expected to maintain strong momentum.

This comprehensive analysis published by Rabobank paints a complex picture of the animal protein sector, outlining key trends and potential implications for stakeholders across the industry.

Source: Noah Wire Services