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The inventory of parental breeders decreased, farmers’ enthusiasm on restocking has increased, and the price of broiler chicks remained at a high level

China Agriculture Report By CnAgri2018-08-15 10:47:05China Agriculture Report Print In early August, the farm-gate price of broiler chicks in the main producing areas was 3.94 yuan/bird, up 30.90% over the same period of last month and up 84.11% over the same period of last year. So what causes the sharp rise in chick price?
 (1) Shortage in GP breeders: according to the monitoring data of BOABC, in July 2018, the inventory of GP white broiler breeders in laying period was 830,000 sets. Calculated on the growth cycle of white broiler breeders, the expansion ratio from GP to commercial generation is about 1:5000. Considering the impacts of forced moulting and consumption decrease caused by macroeconomic decline, 4.3 billion white broilers need be slaughtered annually to reach the balance of supply and demand, needing about 860,000 sets of GP breeders in production. And currently, the gap between supply and demand of GP breeders is about 30,000 sets.
(2) Reduction of parental breeders: Since the second half of 2017, the inventory of parental breeders in production has maintained a low level. According to BOABC’s monitoring data, in July 2018, the number of parental white broiler stocks in laying period was 32.10 million sets, Chinese parents' white feather broilers during the laying period was 32.1 million sets, down by 4.46% month-on-month and a decrease of 3.72% from the same period last year.
(3) The price of parental breeder chicks remained at a high level: from January to June 2018, the cumulative production and sales of parental breeder chicks was 19.38 million sets, down 3.06% year-on-year. At present, the price of parental breeder chicks remains at a relatively high level of 30-40 yuan/set, reflecting the tension in the supply of parental breeders in the industry.
(4) The raising profit of commercial broiler has been greatly improved: the gross profit of commercial broiler from January to July 2018 was about 2.8 yuan/bird, increasing 2.4 yuan/bird from the same period of last year. Driven by higher profit, broiler farms are active in restocking, and the purchase of commercial broiler chicks has increased.   
(5) It will enter the peak season of consumption, and the pace of restocking will be faster: the third quarter is the peak demand season for chicken. With the beginning of new term and the increase in the consumption in fast food and barbecue, the downstream dealers will accelerate the restocking in August.
In summary, the current inventory of parental breeders in production is at a low level, the demand for commercial chicks is increasing, and the demand for chickens in the third quarter is strong. It is expected that the price of chicks will continuously keep high in August and September.

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