The expansion will happen across all species and around all regions, Justin Sherrard, a Rabobank global strategist, said in a podcast accompanying the report.
The analysts project total animal protein production will be up just over 4.5 million tons, about 1.75 percent year over year, bringing another year of expansion above the 10 year average, he said.
The increase should be no surprise. Economic conditions and consumer confidence are ticking up, feed costs remain relatively low and the cycle in cattle and salmon continue to favor expansion, he said.
“What is remarkable about another year of expansion is the focus it will bring on trade. Trade is the only way to deal with ongoing production increases,” he said.
But it’s becoming more complicated than ever before. Old trade agreements are being renegotiated, and new trade agreements are proving very hard to close, he said.
“So we find ourselves in a situation where trade is going to deliver more competition — between species, between trading regions — more volatility and more uncertainty,” he said.
But it will also bring opportunities for those animal protein supply chains that are well connected, strong, agile and innovative, he said.
The analysts are also expecting more consolidation in most regions, changes in the retail landscape — such as online markets — that will flow back through the supply chain and increased use of technology, particularly data-driven technology, throughout the supply chain.
They also anticipate more discussion and more focus on alternative proteins. Not because they’re capturing a large share of the growth in the protein market, which they’re not at the moment, but because they are capturing consumer and investor interest, he said.
The expectation in North America is for a sizable increase in production across all species, with a strong 3 percent growth in total protein supplies, said Don Close, Rabobank senior analyst.
“We think beef production will be up a strong 3 (percent) to possibly as much as 4 percent in 2018.
There’s simply more cattle supply and more cattle on feed. Expansion of the cow herd is expected to continue although at a much slower pace than the last three years, he said.
On the pork side, the analysts are looking for a 3.8 percent increase in production in North America. That increase is largely a reflection of the additional pork processing facilities added in 2017, with one more plant to be completed in 2018, he said.
At the slow end of the North American production curve in the coming year is broiler production, expected to increase 1.8 percent.
That slowdown is largely due to smaller, slower-growing birds and a slowdown in production and tonnage as more and more firms go antibiotic-free, he said.
Globally, aquaculture continues to drive seafood supply growth, with Asia being the most important producer of farmed seafood. That growth in both 2017 and 2018 is estimated at 3 percent to 4 percent.