Conditions were so tough for chicken farmers last year that the country’s largest poultry producer, Astral Foods, posted the first loss since it was founded 23 years ago. Now there are signs of a possible return to profitability.
In a voluntary trading update ahead of its half-year results report in May, Astral said its poultry division had “posted a marginal level of profitability” in the first three months of the financial year. Earnings for the first half year could be substantially higher than for the same period in the previous year off an extraordinarily low base.
This was soon followed by an announcement by RCL Foods, the second-largest poultry producer, which showed that it, too is expecting a better 2024. RCL said it expected its first-half headline earnings per share to be materially above the previous year, while earnings per share could be substantially higher.
This is encouraging, not only for the two major producers, but for the whole poultry industry which is struggling to recover from a disastrous 2023.
Astral said the company had made “good headway” in addressing the issues it had faced last year, including securing its own water and electricity supplies and averting a chicken shortage following bird flu outbreaks through the “costly” importation of hatching eggs. RCL gave no additional information.
There’s still a long way to go – we still have to see details of the first-half performance of these two companies, and then how that translates into profits over the full financial year. However, the two statements are the first evidence of recovery from the worst year in the poultry industry’s history.