- The Chinese government said Thursday it would immediately resume importing chicken and turkey products from the U.S. China banned U.S poultry and eggs in January 2015 following an avian flu outbreak, which, according to The Wall Street Journal, the Agriculture Department said the U.S. has been free of for more than two years.
- The move could mean more than $1 billion in annual shipments to China, U.S. Trade Representative Robert Lighthizer told the newspaper. The National Chicken Council said in a statement access to China’s market could represent that amount in chicken feet sales alone and as much as $1.2 billion in other products — leg and breast meat, turkeys and poultry breeding stock.
- "The United States welcomes China’s decision to finally lift its unwarranted ban on U.S. poultry and poultry products," Lighthizer said in a statement. "China is an important export market for America’s poultry farmers, ... Reopening China to U.S. poultry will create new export opportunities for our poultry farmers and support thousands of workers employed by the U.S. poultry industry."
While this development is a big win for poultry producers, processors and exporters, it may also signify a willingness on China's part to show U.S. trade negotiators it's serious about opening up its markets to U.S. products. The timing of the announcement is also interesting because it comes while the two governments have been negotiating trading conditions as part of a broader ongoing dispute.
Poultry industry groups were predictably pleased with the development. The annual value of U.S. exports to China at their peak were $722 million for chicken and $71 million for turkey, according to a joint statement from the National Chicken Council, National Turkey Federation and USA Poultry & Egg Export Council. The U.S. exported more than $500 million worth of poultry products to China in 2013, according to the government.
Tyson Foods and Pilgrim's Pride welcomed renewed export opportunities to China.The Wall Street Journal noted that without China buying U.S. poultry, many U.S. chicken companies decided to send their chicken feet to rendering plants making pet food ingredients.
"The news that China will lift its ban on U.S. poultry is good news for American poultry farmers and our U.S.-based company," a Tyson Foods spokesperson told Food Dive in a statement. "China has been a significant market for poultry in the past and we look forward to new export opportunities resulting from this opening."
U.S. poultry companies have been taking other steps to diversify while the Chinese import ban was in effect. Last year, Tyson acquired Keystone Foods, a subsidiary of Brazil's Marfrig Global Foods, for $2.16 billion, which was viewed as helping the company position itself internationally despite ongoing trade disputes with China, Canada and Mexico. Keystone is a major supplier of beef, chicken and fish products to McDonald's. Tyson has also been investing in chicken processing plants in the U.S. in order to meet the increasing demand.
This past summer, Pilgrim's Pride acquired Tulip, a U.K.-based provider of meat products to the retail and foodservice sectors, from the Danish Crown Group for approximately $354 million. The acquisition of Tulip, the largest pork producer in the U.K., with almost $1.1 billion in annual sales, was meant to strengthen the company's European foods platform. In 2017, Pilgrim's also bought Moy Park, a poultry producer based in Northern Ireland.
According to Statista, U.S. per-capita consumption of poultry has been gradually increasing since 2013. Total consumption of broiler, other chicken and turkey products reached 92.1 pounds in 2018 and is projected to grow to 92.3 pounds this year.
It's uncertain how much the resumption of poultry exports to China will divert from the current U.S. supply. Stockpiled frozen poultry and beef products were nearing a record last year in cold-storage warehouses across the country because of increased production and slowing demand from export tariffs.
China is currently dealing with its own swine outbreak, which has killed millions of pigs and significantly reduced the supply of pork — a very popular meat with residents of that country. As consumers in China look for other protein sources, chicken could become a more enticing option if the outbreak lingers. It's possible the outbreak was the primary reason China decided to suddenly lift the import ban.