THE POULTRY SECTOR DEMANDS URGENT MEASURES FROM THE GOVERNMENT AND THE EU DUE TO THE COLLECTIVE SALES IN THE HORECA CHANNEL AND COLLECTIVES

sin ayudas ante cierre horecacarlos aranda / Unplash

Production planned to respond to Easter or international tourism in summer faces losses that could exceed 600 million euros

Propollo, which represents the 90% of the poultry sector, requests financial and fiscal support from national and European public administrations for cold storage, as well as to encourage sales in the national and international market

MADRID, April 8, 2020. The Interprofessional Association of Poultry Farming of Chicken Meat (Propollo), has made a appeal to the Government of Spain, through the Ministry of Agriculture, Fisheries and Food, as well as the European Comission, to respond to the production and employment crisis that is already affecting the poultry sector due to the lack of activity in the HORECA sector during Easter, and the international and local tourism forecasts for the summer due to the COVID-19 emergency.

After the exemplary response of the poultry sector to society during the first two weeks of confinement in March, when it had to increase production output to the distribution channel (large and medium-sized stores, hypermarkets and retailers) to 25%, with the extra costs logistics and personnel that this means, poultry farmers saw sales stagnate starting on the 27th of the same month, up to the usual levels in retail, and without activity in HORECA.

The absence of international tourism at Easter (more than 7.1 million visitors in April 2019), and the summer forecasts, when a 63% of spending equivalent to €54 billion is concentrated for more than 64 million visitors, will generate a decrease in demand for poultry meat also in the retail channel.

It is estimated that chicken consumption among international tourists ranges between 16 and 41 million kilos, for an average consumption of 200g/stay or 500g/stay. By autonomous communities, the largest falls in chicken consumption are expected in Catalonia (17,54%), Community of Andalusia (16,03%) and Madrid (14%), according to Propollo analysis. 

The total production of birds (chicken) each month is around 46 million copies, of which a 25% are derived to the HORECA channel. The collapse in demand for this channel has a special effect on the roast chicken section. According to figures from the previous year, only Demand for roast chickens represented 65% of sales in summer 2019, closely linked to large events and tourism on the coast.

The losses derived from the drop in demand could mean up to 600 million euros for the poultry sector. Its effects are already noticeable in companies, many of which are SMEs and family businesses.

In order to alleviate these effects, from Propollo The following measures are requested:

  • Subsidy lines for cold storage incentive (frozen), given the high impact it would have on production prices, in order not to lose the processed product.  
  • Support to maintain parental populations, which will be reduced if their breeding is not possible as a protection measure.
  • Incorporation of poultry meat ICEX sector program for export support campaigns, since it is one of the few sectors not considered.
  • Tax reduction that tax the activity of livestock farmers and industrialists in the poultry meat sector, in line with its role as an essential sector to supply food products to the population.

For Antonio Sanchez, President of Propollo:

“"We are facing a critical situation for the livestock and agri-food sector in general, but with a special impact on the poultry meat sector, which represents 23% of national production."

“The incidence of the fall in tourism in products such as roast chickens has a catastrophic impact on producers and farms, especially vulnerable due to their family and rural profile in many cases.”

"At Propollo we demand an immediate action plan from public administrations, since the consequences for employment and the business fabric are already here, and as an essential sector for the supply of essential products to Spanish consumers, we are assuming an exemplary commitment to respond to this demand, incurring extraordinary costs, for which we need immediate support”.