Thailand's chicken exports to China are forecast to increase by 60% next year, a Thai industry association said on Thursday, as China seeks alternative meat supplies after an outbreak of swine fever nearly halved its pig herd.
China's pig herd is about 40% smaller than a year ago, Chinese authorities have said, after deadly African swine fever swept through the country since it was first detected in August 2018.
Alternative Meat Supplies
Demand in China for alternative meat supplies, the world's biggest consumer of pork, is expected to drive up the volume of Thai chicken exports to 80,000 tonnes next year, said Kukrit Arepagorn, manager of the Thai Broiler Processing Exporters Association.
That is 60% higher than this year's 50,000 tonnes, which was already nearly triple the 18,000 tonnes exported to China in 2018, Kukrit said.
"Exports to China will only grow with each new factory that China allows to export there," Kukrit told Reuters in an interview.
Ban On Thai Chicken
Seven chicken factories in Thailand gained export access to the Chinese market in March 2018. In 2004, China had imposed a ban on Thai chicken due to bird flu outbreaks.
Eight more factories were granted access last month and will start exporting chicken to China in 2020, contributing to the upbeat forecast, Kukrit said.
Thailand has 27 chicken factories. Access requests for the remaining 12 are pending but expected to be approved next year, he said.
Saved By China
Despite the upbeat China forecast, Thailand's total chicken exports next year are expected to rise by only 4.26% to 980,000 tonnes, according to data provided to Reuters by the Association.
Thailand's chicken exports to its top two buyers - Japan and the European Union - declined in 2019, as the strong baht , which became Asia's best-performing currency this year, made export prices less competitive against its main competitor Brazil.
Exports to Japan are forecast to rise by only 0.92% to 440,000 tonnes next year, while exports to the European Union should remain flat at 324,000 tonnes, the data showed.
Free Trade Agreement
When it comes to China, Thailand benefits from a free trade agreement between China and the Association of Southeast Asian Nations, plus the two countries are near neighbours so that the delivery time is only seven days, Kukrit said.
In contrast, Brazilian chicken faces Chinese tariffs and takes about 50 days to be delivered, he said.
"The Chinese market saved us this year," he said.
