World demand for hen eggs by 2015 will be some 12 million tonnes (mt) greater than in 2005 and equate with a production of 70.9mt, according to the International Egg Commission’s statistical analyst, Professor Hans-Wilhelm Windhorst.
About 67% of this additional demand will come from Asia, 12% from Africa and 11% from Latin America. While these regions will expand their contribution to global production, North America and Europe will lose market share.
Risk factors could affect projections
While Professor Windhorst’s projections have been based on likely trends in human population numbers and the development of gross national product and per-capita national income, he is keen to point out that the projected levels of production could also be influenced by at least three other key factors. These are outbreaks of avian influenza, higher feed costs because of the boom in bioenergy production, and political decisions such as the banning of conventional cages in the European Union (EU).
At the outset, he stresses that it is extremely difficult to predict future egg demand and the development of egg production over a period of 10 years because of deficiencies in the available data, the lack of a clear definition of eggs as well as a number of other factors that influence egg consumption and production.
With regard to the definition of eggs, the data is for bird eggs and so includes those from ducks and geese in some cases. Even when they relate to hens eggs, it is not always clear whether the figures include hatching eggs. Nevertheless, Professor Windhorst feels that the projections present a good view of the expected regional dynamics for eggs by 2015.
While the biggest threat for the poultry industry in general is further outbreaks of the avian flu, especially the H5N1 strain, he admits that to-date outbreaks have not had major impacts on egg consumption.
The second risk factor is increasing feed costs, resulting from the boom of bio-energy production in the USA and some European countries, drought impacts in Australia and south-eastern Europe, and an increasing demand for food and feed grain in less developed countries, especially in China. “It is expected that feed costs will remain high and this will impact negatively on the costs of egg production and the market prices for eggs. For consumers in more developed post-industrialised societies, such price increases may not be problem, but higher food costs will hit people in less developed countries with low incomes severely,” Professor Windhorst adds.
On the political front, far-reaching impacts on the future development of egg production and egg trade will arise from a EU directive (1999/74/EU) that bans conventional cages from 2012. Welfare legislation will definitely increase production costs and reduce the competitiveness of egg producers in the EU, which will result in growing imports from third countries.
Professor Windhorst stresses, “These three steering factors will definitely have considerable impacts on the future development of egg production.”
Table 1: Prospects of the global population development between 2005 and 2015 (millions)
Predictions based on socio-economic factors
Professor Windhorst’s approach to forecasting future egg demand is based on socio-economic data at country level: natural population increases, the age structure of the population, the degree of urbanisation, and projections of the development of the per-capita national income. With this basic data, the expected changes of the population and the buying power can be estimated.
The age structure of a population shows how many young persons will grow into age classes with high egg consumption. If only a small percentage of the population is less than 15 years old – as in many more developed countries – total egg consumption will not increase much over the next decade. If, however, the percentage is high, as is the case in many less developed countries, total egg consumption will increase.
In countries with a low degree of urbanisation, egg demand is mainly met either by subsistence production or local distribution. When the degree of urbanisation is high, egg supply is mainly organised through food chains. An increasing degree of urbanisation usually results in a growth of the per-capita national income and increasing buying power.
United Nations expects an increase of the global population of 780 million people or 12% between 2005 and 2015. This growth will, however, not be homogeneous. Asia has the highest absolute increase with 451 million people although Africa shows the highest relative growth with 25%. Europe is the only continent with a population loss. Asia and Africa will contribute 76% to the global population in 2015. Therefore, the expected egg consumption in these two continents is of particular interest. Developments in Latin America and the Caribbean have to be studied in detail, as here the population will rise by 70 million people and growth in buying power is anticipated.
The more developed countries will contribute less than 4% to the population increase between 2005 and 2015, with over 96% coming from less developed countries. Of particular interest is that the least developed countries show the highest relative growth rate with 26% in the analysed time period. They will contribute almost 26% to the global population growth. “This is very important for the future calculations, as in these countries the available money for purchasing food will remain low,” predicts Professor Windhorst.
The gap between the annual population increase in more and less developed countries will become wider within the next decade. Whereas in more developed countries, the population is expected to grow by only 2.5 million people each year between 2010 and 2015, the annual growth in less developed countries will increase by 75.2 million.
Almost 53% of the expected global population expansion will occur in the ten largest countries by population, 22% will be contributed by India alone and almost 10% by China. The highest relative rise is projected for Nigeria (25%) and Pakistan (21%). The future development of egg consumption and production will, to a high degree, depend on the development in Asia, as six of the ten most populated countries are located in this continent.
Per-capita gross national income (GNI) varies considerably between continents and the countries in these regions.
Table 2: Projected development in global hen egg production (2005 & 2015; '000t))
‘Remarkable’ growth in Asian demand
In 2007, over 60% of the global population lived in Asia. Per-capita and total egg consumption will increase in most Asian countries because of an expanding middle class with a growing buying power. Because of the high population in the region, even a slight increase in per-capita consumption will lead to a remarkable growth in total egg uptake.
Slow rise in demand in Africa
Although in Africa, the population will increase by 227 million by 2015, this region has an extremely young population, with 41% below 15 years of age. Africa also has the lowest degree of urbanisation, which means that many inhabitants still have to be supplied with food from subsistence farming or through small outlets in rural areas. And despite comparatively high growth rates of the gross national product, it is expected that egg consumption in this region will remain fairly low compared to other continents. In Africa, demand may not grow as fast as the population because of a low per-capita GNI, low economic growth rates and political instability in many countries south of the Sahara.
Negligible increase in Europe
With 733 million people, Europe is ranked third among the continents in terms of human population, and it is the only one with negative population growth. Egg consumption in most of the EU (15) member states will remain fairly stable over the next decade. It may increase considerably in some of the new EU member states because of the growing buying power in the new middle class. For Europe as a whole, only a minor additional demand can be expected because of the already high per-capita consumption and a decreasing population.
Prospect of considerable growth in Latin America
In 2007, 52% of the 569 million inhabitants of Latin America and the Caribbean lived in only two countries – Brazil and Mexico. In 2015, about 70 million more people will live in this sub-continent. Outside of Africa and Asia, this region has the lowest per-capita GNI. However, a high rate of growth in the gross domestic product in several countries will lead to an increase in buying power and higher consumption. Because of the expected population development and a growing buying power of an expanding middle class, egg demand will increase considerably in Latin America and the Caribbean.
Table 3: Per-capita egg consumption in selected countries (2005 and 2015; kg) and additional demand for hen eggs in 2015
Little growth expected in North America
About 5% of the global population lived in the USA and Canada in 2007. “Because egg consumption is already relatively high in both these countries, low growth is expected in spite of the efforts to convince consumers of the high nutritional value of eggs,” Professor Windhorst says. In North America, only a slow growth of the per-capita consumption is predicted. Any additional demand will mainly be a consequence of the natural population increase and immigration.
Minor upward trend in Oceania
With 35 million inhabitants, Oceania contributed only 0.5% to the global population in 2007. Compared to Europe and North America, egg consumption in Oceania is still quite low. However, it is expected to increase over the next years, in particular in countries outside Australia and New Zealand as a result of a growing buying power.
Only minor changes in total uptake are expected for Oceania because of the comparatively low population and only moderate economic growth rates.
Global trends
More-or-less continuous growth in per-capita egg consumption is expected until 2015. Whereas average per-capita consumption increased by 1.6kg between 1995 and 2005, it is predicted to grow by only 700g or 7.7% by 2015. This will, however, not be a homogeneous regional growth. The highest absolute increase is expected for Latin America and the Caribbean with 1.0kg, Oceania and Asia with 900g and Africa with 800g. In North America and Europe, the growth rate will be considerably lower at 300g and 500g, respectively.
Projections for the global total for 2015 point to an additional demand of 12mt compared to 2005. On the country level, China shows the highest additional demand with over 6mt, followed by India, USA, Brazil, Indonesia, and Turkey. Of the countries that were selected for a detailed analysis, only in Hungary, Japan, and Greece will demand be lower than in 2005.
For 2005, the volume of hen egg production for North America (USA and Canada) is lower than that given in the United Nation’s Food and Agriculture (FAO) database, as for both countries, hatching eggs are included in the higher values. Therefore, data given in the 2007 Annual Review of the International Egg Commission has been used. It can be assumed that hatching eggs may also be included in the data for other continents. The available figures for Africa, Asia, and Latin America do not permit the calculation of hatching eggs therefore the per-capita consumption figures for these continents may be too high.
Global total production rises from just under 59mt in 2005 to almost 71mt in 2015.
Figure 1: Projected development of per-capita egg consumption (2005 & 2015; kg/person/year)