Positive outlook for poultry production in eastern Europe
High feed and energy prices and an influx of relatively cheap Ukrainian poultry meat has made the last few years quite challenging for poultry farmers in Eastern Europe, a region accounting for the lion’s share of EU production. Early signs show a brighter future, despite new challenges posed by a transition to ‘greener’ production.
Several Eastern European countries are poised for robust growth in poultry output in the coming years, as USDA outlined in its recent report. Specifically, positive shifts are anticipated in Poland, Romania and Croatia. Poland, the EU’s largest broiler meat producer, is expected to boost poultry output by 7% in 2024, the USDA reported. In 2025, the output is projected to inch up by a moderate 2%, but given that the country alone accounts for as much as 22% of the bloc’s production, that increase should be tangible in absolute figures.
The last few years were turbulent for Poland’s poultry sector, but the storm seems to have subsided. “After struggling with high energy and high feed costs in 2022, the economic situation of the Polish poultry sector has improved significantly as feed costs have declined and wholesale and retail prices have increased,” noted the USDA.
The US researchers also praised the recent Polish government decision, which postponed the controversial ban on the use of GMO feed from 1 July 2025 to 1 January 2030. The ban has long been a subject of fierce debate between the livestock industry and environmentalists. Most of Poland’s population favour restrictions on GMOs, but authorities have admitted that the ban would deal a deadly blow to the poultry industry, making farmers less competitive. During discussions with authorities, the National Poultry Council, a leading union of poultry farmers, advocated postponing the GMO ban beyond 2025, as the original proposal envisaged, emphasising that farmers need certainty to justify new investments in their operations.
Other Eastern European countries also see their poultry industries recovering following challenging years. “We can see in statistics that poultry production is very dynamic in many Eastern European countries. Production is increasing, especially in Romania, Latvia and Poland,” commented Paul-Henri Lava, senior policy advisor for AVEC, a European poultry farmers’ association.
A Ukrainian factor
Over the past few years, the European market has been inundated with Ukrainian poultry imports, with eastern EU members bearing the brunt of this influx. “Clearly, the neighbouring countries have been the most affected by these [Ukrainian] imports,” Lava commented. “Poland, as the EU’s leading chicken meat producer and price setter for the bulk market in breast meat, has felt the competition from cheaper Ukrainian products acutely. This has triggered a snowball effect across the EU, as Polish producers have been forced to seek new markets within the EU, intensifying competition and increasing pressure in other member states,” Lava explained.
Although complaints have been heard in many parts of Europe, they were the loudest in the countries bordering Ukraine. Polish, Hungarian, Slovakian and Romanian farmers were among those protesting duty and quota-free poultry imports from Ukraine, commented Aleksandras Bacevicius, an analyst with Euromonitor International, a Brussels-based think tank.
The European Commission is investigating the matter and were set to announce their findings and plan of action in November 2024. Market players share common expectations that policymakers would come up with some restrictions. “We will probably see something similar to eggs, oats and sugar, i.e., duty-free quotas on poultry. After exceeding them, imports from Ukraine will again be subject to EU customs duties that will probably be introduced on poultry, too,” Bacevicius said.
For the egg sector, AVEC estimates that the pressure is still particularly severe in Romania, Bulgaria and the Baltic countries. “We believe that implementing quotas is the best way to maintain Ukrainian imports at reasonable levels,” Lava said.
A new hotspot
Despite looming restrictions, Ukrainian poultry farmers aren’t giving up on the European market. The USDA indicated a growing interest from Ukrainian businesses in investing in poultry production assets in Europe. For instance, the Ukrainian company MHP recently announced plans to build 3 chicken farms in Croatia by 2027, producing 6 million chickens annually. Another Ukrainian company, Petrinja Chicken Company, also announced a €500 million investment in Croatia to produce 150,000 tonnes of chicken meat annually by 2026. It is estimated that the projects will add an annual production of 45 million birds to Croatia’s current production of 235 million.
New capacities are established primarily with the focus on keeping access to the market which could soon be barred under the pressure of European farmers. “The new fully vertically integrated farms are expected to focus as much as 90% of production for export to other EU member states and to Asia,” the USDA estimates. European farmers have already sounded an alarm over these plans. In June 2024, the French organisation for the poultry industry, Anzol, warned about the detrimental impact of these projects on the poultry industry supply chain in Europe, calling on policymakers “not to allocate any European funds” to Ukrainian poultry farms in Europe.
Ukrainian poultry businesses have been gaining a foothold in Europe, as MHP launched or acquired assets in the Netherlands, Slovakia and the Balkans over the past decade. Despite repeatedly sounded concerns, it looks like local farmers can do nothing about this expansion.
Regional differences
Although the EU has long been considered a single poultry market, analysts indicate that there are several important differences between the West and the East. According to Euromonitor International’s Fresh Food and Staple Foods projects, western Europe consumes considerably more processed poultry — chilled and frozen — than those in eastern Europe, which has a slightly larger per capita consumption of fresh poultry, Bacevicius said.
“All of Europe had been experiencing a healthy trend in foods for a while now, with the younger generation increasingly opting for poultry meat. The difference in consumers only lies in the multicultural nature of western Europe — for example, the Muslim population doesn’t consume pork meat at all, giving a boost to other types of meat in retail and food service,” Bacevicius said.
Some differences are seen on the production side, too. “I would suggest that market consolidation in Poland may still be less advanced,” Lava said. “It also seems that in western Europe, consumers with higher purchasing power are interested in segmented products, such as the Beter Leven (‘Better Life’) label in the Netherlands, while this appears to be less the case in eastern Europe. Ultimately, the differences between western and eastern Europe are not as substantial as they may seem,” Lava emphasised.
Uneven landscape
Not all parts of the region perform equally well. The USDA indicates that poultry production remains stagnant in Hungary, owing to bird flu outbreaks in recent years. Moreover, an estimated 15% of Hungarian poultry producers gave up their business in 2023, said the USDA. This is clearly a waning trend, though it primarily led to industry consolidation, and has not driven the industry’s performance down. However, the picture is similar in western Europe, where some countries perform better than others.
Chicken meat production in the Netherlands is slowly declining as more producers are favouring higher quality, lower population density, slow-growth birds. About 40-50% of Dutch production is now dedicated to this form of higher-end production. In a similar way, chicken meat production in Germany is expected to grow only marginally in 2024 and 2025, the USDA reported. Stricter regulations on animal husbandry under the Animal Welfare Initiative are reducing population densities on German farms. Today, it is almost impossible to obtain permits for new sheds, which is a significant factor limiting growth in production.
Green transition
The future is not entirely cloudless for poultry farmers in eastern Europe, owing to a green transition. Some industry organisations in the region heavily criticise the reform, warning about dire consequences for European food security. “Food in Europe is already more expensive than anywhere else in the world. And now, due to senseless actions, it may become even more expensive,” said Dana Večeřová, president of the Czech Food Chamber. “Concerns about the effects of the green transformation are justified,” she added. “It is already difficult for businesses to adapt to the new regulations, and the European Commission wants to introduce even more controversial regulations,” Večeřová said, questioning the rationale behind adopting stricter regulations than in other countries. “In the future, Europe may finally achieve its climate goals on its own territory. However, this will not have an impact on global greenhouse gas emissions and will ultimately lead to reduced production and increased imports from outside the EU.”
It remains to be seen to what extent the green transition could impact poultry farmers in eastern Europe. Lava expressed confidence that the entire European poultry industry will be significantly affected. “On the positive side for the east, I believe they often have more recent facilities that may be more energy-efficient than old barns, for example,” Lava said. “On the negative side, for a country like Poland especially, the transition from using coal to generate electricity to greener sources may be costly. But ultimately the biggest impact for GHG emissions in poultry production is feed consumption: since most producers in Europe use the same breeds and same type of rations, I do not believe there will be significant differences,” Lava added.
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