Market Trends of united arab emirates poultry meat Industry
Rising demand for local products will lead to growth in production
- In 2022, poultry production in the UAE observed a 13.07% increase from 2021 due to higher demand for the UAE chicken meat products and increasing government support. Most poultry farms in the United Arab Emirates are located in the Emirate of Abu Dhabi, as it accounted for more than 70% of UAE agricultural production in 2021. Due to rising input costs and a price restriction, the UAE's poultry output is expected to rise slowly over the next few years. With growing commodity costs, the business keeps consumer prices stable by cutting production costs. Consumers are becoming more conscious of good packaging claims and are actively seeking local, fresh production that contains no hormones or antibiotics and is produced directly from UAE farmers.
- The UAE poultry production depends on imports for nearly all inputs, from medicine, packaging, and equipment to feed. These substantial cost increases have challenged the production capability and reduced profitability. Higher poultry prices were registered in the country, attributed to higher input costs, eroding much of the margin gains. From September 2019 to September 2021, feed grain prices increased by 55% in the country.
- Higher input costs have been exacerbated by the UAE government, a set price ceiling or cap within local coops, and other retail establishments that sell primarily to the Emirati community. The UAE government maintains a price cap of USD 5.85 plus VAT on all fresh chicken sold within the United Arab Emirates, and retailers may not exceed this price; while the price cap is occasionally adjusted, the policy keeps production from expanding further.
Understand The Key Trends Shaping This Market
Download PDF
Higher production costs are impacting the market prices
- The price of poultry meat in the United Arab Emirates increased by 0.96% in 2022 from the previous year. Poultry meat price is primarily driven by increasing demand and dependency on imports. The climate in the Emirates has also played a role in influencing the poultry meat price in the country. Historically, there has been a seasonal slump in demand for poultry meat in the summer, and 10% of the chicken meat sold in the Emirate is frozen.
- Following the issuing of Ministerial Resolution No. 41 of 2023 earlier in June, the Ministry of Economy authorized the price rise in March 2023. With this issue, shops in the UAE will be legally permitted to raise the price of eggs and poultry meat by up to 13%. This change in prices was a result of the demand made by retail firms to increase the prices of egg and poultry meat as the market is experiencing higher costs of manufacturing local and overseas products. In the UAE, prices are tightly controlled, and providers must obtain Ministry clearance before making adjustments. After six months, the price rise will be evaluated, and price increases may be adjusted or eliminated.
- Although the rise of the poultry farming sector is a sign of encouragement for market stakeholders, it will be challenging to scale poultry meat production in the country. The Emirate is inhospitable to most forms of agriculture because of its arid climate with nominal rainfall. In the United Arab Emirates, precipitation dropped from 70.46 mm in 2020 to 51.46 mm in 2021. Most poultry farms in the country are located in the Emirate of Abu Dhabi. High dependence on a singular source will make it difficult to stabilize prices during possible economic downturns like a global recession.
Understand The Key Trends Shaping This Market
Download PDF
