Resilient economic outlook supports poultry demand

Global growth resilience, easing inflation and lower feed costs are supporting poultry demand, although rising oil prices and geopolitical tensions continue to pose risks to the sector.

By Paul Makube, senior agricultural economist at FNB Commercial, Agriculture

At the start of 2026, the International Monetary Fund projected global growth of 3.3%, reflecting resilience despite the disruption to global trade following the United States’ “Liberation Tariffs” in 2025 and the ongoing Russia-Ukraine war. Projected growth for 2027 was slightly lowered to 3.2%. Global headline inflation was expected to ease from 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027, a trend that typically supports consumer demand for affordable proteins such as chicken.

However, the renewed conflict in the Middle East due to Donald Trump’s Iran war has increased uncertainty. Brent crude oil prices surged from around US$70 per barrel of oil (bbl) to well over US$100/bbl, raising risks for fuel, freight and input costs. This could delay interest-rate relief and place pressure on household spending.

In South Africa, growth is projected at 1.6% in 2026, rising to 1.8% in 2027, supported by resilient consumer spending and improving investment confidence. Fiscal policy is also supportive, with government withdrawing R20 billion in planned tax increases and adjusting personal income-tax brackets and medical-tax credits for inflation. These measures should help sustain consumer demand, reinforcing the role of chicken as the most affordable protein.

Global meat production trends remain mixed. The United States Department of Agriculture’s global data show beef production declining by 1.5% to about 61 million tons, while pork and chicken output increase to 109.6 million and 117.2 million tons respectively. Chicken exports are expected to grow by 3.3% in 2026 to about 14.9 million tons, outperforming beef and pork exports.

Avian influenza remains a risk for the global poultry supply. However, lower feed costs are improving margins across the sector, supported by strong grain harvests, including global maize production of roughly 1.3 billion tons.

In South Africa, meat-price inflation reached an eight-year high of 13.5% year-on-year in January 2026, driven mainly by sharp increases in beef and pork prices. This widening price gap strengthens chicken’s competitiveness in the protein market. Chicken imports also declined by 7.2% in 2025 to 37 592 tons, supporting local producers.

Feed costs have fallen sharply following a record maize crop in 2025 and another strong harvest expected in 2026. Average yellow-maize prices dropped by 34% year on year in February 2026 to around R3 358/t, improving feeding margins for poultry producers.

Poultry demand should remain firm as consumers continue to favour more affordable proteins. Lower feed costs and reduced imports support domestic production, although higher oil prices and global conflict remain key risks to the outlook.