Christmas Turkey Market Trends

Frawley/Neville

The Christmas season is upon us and we have prepared a digestible parcel of Turkey trends with a focus on Irish, UK, US and Australian markets. Key trends that have emerged from this article include the recognition of turkey as a healthy alternative to red meats and other poultry, the expansion of the Christmas Irish turkey market, the cost of feed hurting the UK turkey market and the challenge Irish producers face in differentiating their offerings over standard birds while combatting third country imports; currently at 30%.

Perceived Health Benefits of Eating Turkey Meat

Source: Richard Halleron, Agriland, Nov 6, 2017
  • The Irish poultry meat market is expected to grow in the coming years, it has benefited from the following setbacks within the red meat sector: (1) the 2015 World Health Organisation report indicating red meat as a possible carcinogen and (2) the 2013 Horse Meat scandal
  • Turkey production is identified as a future key growth area within Irish poultry sector. Irish consumers perceive turkey as a low fat meat option and an important protein source – Professor Geoff Simmons, Queens University Belfast
  • 25% of Irish consumers seek to increase the level of protein in their diet

IRELAND: MARKET TRENDS

Turkey Industry in Ireland

Source: Teagasc, Poultry Industry in Ireland, 2017
  • A small number of companies control the poultry breeding industry worldwide and award franchise rights, Ireland has the same commercial stock as any other area in the developed world
  • Ireland produces four million turkeys annually; the industry is seriously affected by imports from third countries and are unable to compete with such a high raw feed cost
  • Ireland is the highest consumer of poultry meat in the EU at almost 26kg per capita (with turkey consumption at 6.3kg per capita) per annum. The Quality Assured logo is a must for any producer looking to differentiate a home grown offering
  • Robust biosecurity and bird welfare maintenance are management requirements and best biosecurity practice is to confine one species and one age to one poultry site; implementing an “all in, all out policy”
  • Three farm categories exist in growing turkeys; intensive, seasonal farm fresh and seasonal / farm fresh
  • Supermarket chains are focusing on traceability and only deal with substantial producers, sole traders would need to link with an established processor or packer

Small Scale Turkey Producers at Irish Farmer’s Markets

Source: Ciaran Moran, Agriland, June 2016
  • The Food Safety Authority of Ireland urge small scale poultry processors to register with their local authority’s veterinary services, well in advance of Christmas, to ensure traceability and protect consumer health
  • In Ireland, Over 750,000 turkeys are processed annually, approximately 700,000 are required in December alone. Approximately one million turkeys are sold in Ireland coming up to Christmas and 30% are imported (Richard Halleron, Agriland)
  • There are 11 small scale approved poultry slaughterhouses located in Ireland
  • Small scale poultry processors are those who slaughter less than 1000 birds in a week or less than 10,000 per year and whose poultry is sold within 100km radius of their farm.

Traditional Irish Christmas Turkey Market is Extending

Source: Richard Halleron, Agriland, Nov 2016
  • The traditional christmas turkey market has extended into November and the new year to cater for the growing trends of Thanksgiving celebrations and new year healthy eating commitments
  • Turkey Meat is recognised as a healthy eating option due to low fat content
  • Commissioner Phil Hogan had stated in 2016 that supermarkets’ below cost selling “remains a major challenge for the turkey industry in Ireland”
  • The challenge for Irish producers is how to differentiate their birds from the more standard turkey offerings available, for example one farm is offering a slower maturing bird with better breast definition

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UK: MARKET TRENDS

UK Turkey Producers: Production Costs Rise Faster than Inflation

Source: Johann Tasker, Farmers Weekly, Sep 7, 2017
  • Overall costs to UK producers will rise on average by 6.63% due to Brexit’s weakened pound, it will be challenge for producers to recover this increase from the market
  • The main cost increases involve feed prices (+15%) and plucking/evisceration (+8%)
  • These costs will be passed on to consumers in order to keep producers in business
  • Turkey sales were up 5.7% by volume last Christmas, driven by 9% increase in demand for whole birds – Kantar
  • Fresh crowns and joints are dominating the UK turkey market, accounting for 55% of sales in 2016

UK Poultry market: Strong Consumer Demand and Predicted Rise in Costs

Source: UK unprocessed poultry and red meat market report, Nov 2017
  • As costs are predicted to rise within the UK poultry market, retailers need to differentiate their turkey offerings based on relationships to their farmers and responsible antibiotic use

Turkey Infused Christmas Gin from London

Source: Poultryworld/UK, Oct 2017
  • Portobello Road Gin’s master distiller, Jake Burger, borrowed techniques from Mexico’s artisanal Mescal producers to produce a small batch of ‘poultry-infused potable’
  • The process involves hanging an organic turkey breast in the still, where it cooks while allowing the alcohol vapours to pass through during distillation. This technique absorbs the more intense fruit flavours from the 13 added botanicals; dried fruits and spices

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US & AUSTRALIA: MARKET TRENDS

Source: Poultryhub/commercial poultry/turkey

US

  • Global turkey meat production is 5.7m tonnes/year approx. with 60% produced in North America; turkey’s native home
  • The typical lifespan of a US turkey is 10 years, the hen turkey takes 16 weeks to mature while the tom turkey takes 19 weeks
  • The feed conversion ratio of a modern US white hybrid turkey is about 2:1
  • Breast meat is 70% of the carcass value, followed by thigh meat at 13% with breast meat having only 1% fat
  • US toms now have so much breast meat they cannot mate as a result hens are artificially inseminated
  • The white feathered hybrid is the mainstream turkey in the US and the industry is dominated by two breeding companies with 75% market share

Australia

  • The most popular turkey sold in Australia is the hybrid white bird; the males are chosen for their body conformation, the females are chosen for their lack of broodiness and egg production ability
  • Australian turkey production had dropped from from 36,400 tonnes in 2007 to 22,500 in 2013. Whole bird turkey meat is expensive compared to the US, due to feed contributing to 60% of the production cost
  • The industry processes 5m birds and generates $200m annually
  • Australia has 6 dedicated turkey and chicken processing plants
  • There is a small export market for turkey eggs to Taiwan
  • Israel has the highest turkey meat per capita consumption of 11.25 kg, in contrast Australia’s is 0.83 kg and  Ireland’s is 6.3kg (insidermonkey.com)
  • The Australian consumer can now buy over 60 different cuts of turkey
  • A larger share of consumers’ budget is being achieve with further processed products including turkey hams, steaks and sausages