New 10 year global estimates were recently published by the United Nations Food and Agriculture Organization (UN/FAO). These estimates confirm our expectations of strong global food demand growth.
From the baseline of 2013 to 2023, global poultry meat consumption will rise by 27 mmt in 10 years; for reference, U.S. broiler production in 2013 was 17 mmt. Global pork consumption will rise by 14 mmt, while global beef needs will rise by 9 mmt. Global beef production has seen virtually zero production growth over the past 7 years. These estimates will be very supportive to commodity prices going forward. Even beef and pork, which showed lower growth rates will require significant expansion. Global beef supplies have hardly seen measureable growth in the past 7 years, but global consumption is expected to increase 9 million metric tons over the next 10 years. If these forecasts play out, then the current high global beef prices will be sustained and even increase to spur producers up to those levels by 2023. This chart shows the absolute cumulative expected increase for poultry, pork, and beef consumption over the next 10 years. For equivalent production levels to be reached global prices will need to remain elevated. The UN/FAO estimates also point to higher feed demand with soybeans seeing the strongest demand growth (+21%, 87 mmt or 3.4 billion bushels), but also coarse grains (corn) seeing strong growth (+14%, +179 mil mt, or +6.5 billion bushels).
While the rapid price shocks of U.S. (and global) beef and pork over the past year were dizzying, do not expect the broadly-elevated prices to fall significantly. Global demand growth is for real with an additional 78 million consumers joining the global population each year. Improvement in global economies will further support this demand.