Poultry Producers Moving Past HPAI

Monday, December 30, 2024

Next Challenge Could Be the Status of The Canadian Consumer

By Emily Mckinlay

After facing the challenges of avian influenza, the poultry industry’s next obstacle could be household budgets.

Chicken Farmers of Canada states that there are currently no active cases of Highly Pathogenic Avian Influenza (HPAI) in Canada. They are working with the Canadian Food Inspection Agency (CFIA) and the poultry industry to prepare for potential future outbreaks with the goal of minimizing impact on the industry.

Since the first reported case in December 2021, the CFIA estimates that more than 11 million birds have been affected by the virus across Canada.

Graeme Crosbie, senior economist at Farm Credit Canada (FCC), says that the virus did cause disruptions in the poultry market.

“It has caused a lot of volatility in the North American poultry market – in Canada, but also the United States.

“Things are a little different here, given supply management. It has caused volatility in production, prices, and also availability in some respects. It has shown up in prices over the last two to three years.”

In a recent blog post by Crosbie for FCC, the economist reported peak prices for broilers in 2023, which have been decreasing since. He expects the price to stabilize in the spring of 2025.

Avian influenza also created production challenges. Crosbie noted that the shortage in the supply of broiler chicks caused by HPAI has partially caused an increase in chick costs for the past two and a half years. He also reported lower egg production in 2023 but has seen a rebound in production between June 2023 and May 2024.

With preparation by poultry producers and industry members across Canada, ideally further waves could be avoided. Crosbie believes another wave would be less likely to cause the price volatility observed in the past few years.

“Hopefully, there’s no major spread of avian influenza again, but we can’t rule it out,” says Crosbie.

“If that occurs, I think it would have more of the same impacts as what we saw in 2022 and 2023 in terms of decreased production relative to what we saw, and it would be likely to increase prices.

“If something were to happen again in 2025, I can’t see there being the same price volatility because the other aspects of what goes into food prices at the grocery store have somewhat stabilized and slowed a great degree compared to 2022 and 2023.”

The poultry industry has been very effective at restoring production levels during a time of stress.

“I think it is remarkable how quickly producers got back online during outbreaks in the past few years,” says Crosbie.

“I think the impact if an outbreak happened again would be felt less on the consumer end and more on the producer end in trying to limit the spread and get production back online as soon as possible.”

As the poultry industry moves forward, putting the past waves of HPAI behind them, Crosbie says the next challenge will be the status of the Canadian consumer and how poultry will fit in their diet and budget.

“We’ve seen in the last 18 to 24 months that between food inflation having been so high, and interest rate increases meant to combat that inflation, consumers’ pockets are squeezed even more than they were a few years ago.

“The big story going forward, not just for poultry products but for all food, is going to be the status of the Canadian consumer heading into 2025. It will depend on how tight household budgets are going to be, shopping behaviour, and the impact of that on the demand for products.” BF