Bird flu, rural downturn ravage China poultry numbers

By Niu Shuping and Tom Miles

BEIJING, March 3 (Reuters) - The impact of bird flu and the economic slowdown may have cut China's poultry numbers by about a third or more in the last month, executives in the poultry feed industry said on Tuesday.

Although China has not disclosed any significant outbreaks of bird flu or the extent of the impact on the industry, feed company executives say the sector has suffered a dual blow from disease and a drop in demand that could keep stocks in short supply into the third quarter.

"There have been very few restocks after the Chinese Lunar New Year. Poultry stocks could have fallen by 30 to 40 percent compared to last year," said one executive from a leading feed and poultry producer.

Families traditionally feast over the Lunar holiday, which fell at the end of January this year, causing a bump in demand.

Consumption has also taken a big hit from weakening demand.

"Overall demand is falling, particularly from migrant farmers, who used to be the major force in poultry consumption. Urban consumption has also seen a decline," said the executive, who declined to be named.

Traders have said weak poultry breeding is to blame for a sharp fall in prices of soymeal <0#ASSOYMEAL-CN>, a protein-rich feed, which has prompted some cancellations of U.S. soybean cargoes from China, the world's top buyer.