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USDA International Egg and Poultry

10 September 2014

USDA International Egg and Poultry: Saudi ArabiaUSDA International Egg and Poultry: Saudi Arabia

Chicken has been the most competitive source of animal protein in Saudi Arabia. Both imported and domestically produced chicken are sold at considerably lower price levels than imported chilled lamb and low quality beef and also domestically produced lamb and veal.
USDA International Egg and Poultry

Because of its affordable prices and the perception of being healthier when compared to red meat, chicken consumption in recent years has been steadily rising. Continued growth of hyper markets and super markets in Saudi Arabia, besides helping increase availability of different poultry varieties, has also helped boost the overall demand for poultry meat.

Poultry meat consumption in Saudi Arabia is estimated at 47 kilograms per year, among the highest in the world. Saudi consumers prefer locally produced fresh broiler chickens with more than 80% of local broiler meat sold chilled. There is a perception among some Saudis that domestically produced broilers are of higher Halal standards than imported products from non-Muslim countries.

The poultry meat market in Saudi Arabia has a cyclical nature. Demand drastically rises when millions of pilgrims arrive during the holy month of Ramadan and Hajj season and declines during the summer months when Saudis and expatriate workers leave for vacations.

A small decline in broiler meat consumption is expected for 2014 as the Saudi Arabian government tries to manage the risks associated with MERS Corona within the country as well as the Ebola outbreak in West Africa this year. Broiler meat consumption is forecast to increase 5% in 2015 due to annual population growth and an increase in the number of pilgrims expected with the completion of the Two Holy Mosques expansion projects and reduced concerns over MERS infection.

Poultry meat is currently consumed mostly as whole broilers. However, demand for white and dark chicken parts has been rising due to increased demand by working couple households and increased interest for ready-to-cook poultry meals.

Several years ago the Saudi Arabian government stated a goal of full self-sufficiency in poultry meat consumption. Domestic poultry meat production in 2013 covered 42% of consumption needs.

Saudi Arabia’s poultry meat self-sufficiency is forecast to rise to 46% in 2015. To help increase broiler meat production Saudi Arabia has been encouraging the establishment of new broiler farms and the expansion of existing ones by offering various types of production support including animal feed subsidies, interest-free loans, and rebates on certain poultry equipment. Broiler production costs are high in the country due to a heavy reliance on poultry feed products, vaccines, equipment and year-around extremely hot weather.

A main constraint for Saudi Arabia to increase broiler meat production is endemic poultry diseases and high chicken mortality rates. In response to this, Saudi Arabia has established an insurance program with the aim of establishing unified stricter bio-security plans for participating poultry farms, reducing chicken mortality from 25% to 5%, and compensating farmers for financial losses from poultry disease outbreaks.

Saudi Arabia exported 35,000 metric tons (MT) of broiler meat in 2013. Even with poultry exporters required to reimburse the government for various production subsidies, estimated at $533 per MT, exports are forecast to reach 50,000 MT in 2014 because of their perceived high quality.

Saudi Arabia imported 875,259 MT of broiler meat in 2013 making it the world’s largest importer. Broiler meat imports are forecast to drop about 10% in 2014 due to decreased demand from food caterers because of an anticipated reduced number of pilgrims and higher local production. In 2015 imports are expected to increase slightly due to more pilgrims because of an expected visa relaxation.

Sources: USDA/FAS GAIN Report SA1410

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