Chicken industry executives had a lot to celebrate at their annual meeting in Washington last week. Their product sales continue to increase at home and in export markets. USDA withdrew a proposal – known as the GIPSA rule – they strongly opposed. But the National Chicken Council (NCC), whose member processors produce some 95 percent of U.S. chicken, is nervous about uncertain trade policy, the supply of immigrant workers and attacks from well-heeled campaigns by animal welfare activists.

Broiler chicken consumption is expected to be up 1 percent next year and U.S. chicken exports are expected to gain again, USDA Chief Economist Robert Johansson told the group. The outlook for economic growth around the world is “mixed but stabilizing,” he said, with most recent estimates seeing growth accelerating in Europe, Japan and China. While U.S. economic growth is anemic, business and consumer confidence are strong, he said, but “trade issues continue to present challenges” to export market growth.

New NCC Chairman Ben Harrison, CEO of South Carolina-based Amick Farms, cited the challenge of “preserving existing trade partners and getting back old ones” amid the uncertainty surrounding the North American Free Trade Agreement.

Ben Harrison, NCC chairman

“Last year the U.S. exported 3.7 million tons of chicken products with a value of nearly $4.6 billion to more than 100 countries,” he said, with Canada and Mexico among the industry’s top five markets. “Quite simply, NAFTA has been a bonanza to American agriculture.” He said the industry would continue to urge the administration to “insure that our trading partners recognize regionalization when it comes to avian influenza” rather than restricting exports from the entire United States because of a local outbreak.

The industry has “a real opportunity to work with Congress to develop a policy on immigration reform” with introduction of legislation to create a “viable guest worker program,” Harrison said. “Along with that, we will be encouraging Congress to consider our priorities of comprehensive immigration reform and creating options for the 11 million undocumented workers that live in the shadows of our economy.”

NCC’s board recently updated animal welfare guidelines that are “the most comprehensive to date,” he said, and would publish them within a few months after certification by third party auditors. The industry is continually “being challenged by activists on these welfare issues. Industry is not afraid of change; we’ve faced it the last 60 years. We want to make sure the change is based on science rather than emotion and make sure that the activists aren’t the only ones being heard from.”

Matthew Salois, director of global scientific affairs and policy for Elanco Animal Health, related how “extreme NGOs (non-governmental organizations) are putting pressure on marketing decisions and financial institutions and investors” in the food industry to impose more stringent animal welfare standards on poultry and other protein producers.

“Why the focus on poultry?” he asked. “Because it's a numbers game. The number of poultry dwarfs all other species. Also because it’s a lot faster to raise a bird than a hog or a steer, they have the ability to make change more quickly,” Salois said.

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Activists have had some success with campaigns to reduce the use of antibiotics in the poultry industry, he said, estimating that 40 percent of broiler chickens are raised in “some sort of antibiotic-free program.” The next “tipping point” after antibiotics is the demand for slow-growing chickens, which activists consider more humane.

Salois used as an example of organized animal welfare activism the Global Animal Partnership (GAP), a group formed by the Humane Society of the United States (HSUS), Whole Foods Markets and others to codify animal raising standards. In addition to antibiotic-free and pasture-based systems, GAP promotes slow growth, recommending broiler chicken weight gain of no more than 35 grams per day. “I am not aware of any major producer raising birds at 35 grams per day,” he said, adding that conventional systems still account for 94 percent of total chicken volume.

While some GAP standards would improve animal welfare, he said, adoption of all its recommendations would translate into far less food, increased feed and water requirements, additional land use and reduced environmental sustainability, he added. “The activists want to cut back on intensive agricultural production. If policy restricts productivity, there will be an effect on food security.”

On the international front, Evan Feigenbaum, a former State Department trade official who is now vice chairman of the Paulson Institute at the University of Chicago, offered a more restrained assessment of the potential for market openings in China and India, two potential growth markets for U.S. chicken exports if they lift restrictions tied to avian influenza concerns.

“Beijing and Delhi are where Asia's emerging giants are heading,” he said. “The ‘China juggernaut’ story is now changing. Some say China is on the brink. Others say it’s overloaded with debt. The truth is somewhere in between. China is going to change more than we expected but it will not be the same kind of reform as we might have. (Governance) reform and economic opening do not go together under Xi,” he said, referring to Chinese President Xi Jinping.

Feigenbaum expects China’s market will “open gradually under their own timeline, after their own companies become dominant in the marketplace.” Feigenbaum said he expects “lots of potential business deals but not a lot of market access when President Donald Trump visits this week.

“We are in for a period of greater U.S.-China security tension,” he added. “That could bleed over to economic relations. Standards will become a matter of contention. China wants its standards to become default global standards, and that could be a trade problem for the United States.”

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