China’s cheap chicken and dairy exports shake up global food markets

TENGZHOU, China: China’s push to strengthen food security has produced an unexpected consequence: a growing surplus of meat and dairy products that domestic consumers cannot absorb. Now, Chinese producers are turning to overseas markets, using lower prices and expanding production capacity to challenge established food exporters worldwide.

At Wintop Food Group’s poultry-processing factory in Tengzhou, Shandong province, international demand is helping finance the company’s expansion. The business processes around 60 million chickens annually, supplying products such as chicken breasts, nuggets, meatballs and dumplings to more than 20 countries.

Exports accounted for half of Wintop’s profits last year, according to general manager Dang Yangyang, who said international buyers were increasingly attracted by the company’s competitive prices.

“When the meat is $1,000 cheaper per ton than Brazilian and Thai competitors, they have to either buy from China or lose out,” Dang told Reuters.

China’s expanding protein industry is benefiting from investments in technology, larger production facilities and government support aimed at strengthening domestic food supplies. But changing eating habits, slowing economic growth and excess production have left companies searching for customers beyond their home market.

The shift is creating new opportunities for consumers seeking affordable food while raising concerns among competing producers and trade regulators.

Changing diets create a surplus

For decades, pork dominated China’s meat consumption. However, changing preferences among urban consumers are reshaping the market.

Health-conscious consumers have increasingly turned away from fatty pork cuts, while chicken has gained popularity as an alternative. Per-capita pork consumption has fallen 13 per cent since reaching its peak in 2023, while chicken consumption rose more than 50 per cent per person over the decade through 2024.

Despite weaker demand, production has continued to grow.

China produced a record 59 million metric tons of pork last year, while poultry output increased by 7 per cent, according to government data cited by Reuters. The dairy industry also exceeded its official production targets for 2025 two years ahead of schedule.

Government subsidies helped encourage investment in large-scale livestock operations as Beijing sought to strengthen food security and rebuild animal herds following the African swine fever outbreak and the Covid-19 pandemic.

According to the Organisation for Economic Co-operation and Development, subsidies accounted for about 13 per cent of Chinese agricultural producers’ gross farm receipts between 2022 and 2024, nearly three times the level recorded in the early 2000s.

The resulting oversupply has contributed to falling prices across several agricultural sectors.

For small farmers, the consequences have been severe. Hebei province pig farmer Huang Weiying, who once raised more than 500 pigs, told Reuters she was preparing to sell her remaining animals after accumulating around $75,000 in debt.

“Pig prices are so low. People in the cities just stopped eating pork,” she said.

Exporters expand overseas

For major Chinese producers, international expansion has become an increasingly important route to growth.

Dairy companies are targeting markets in Southeast Asia, Africa and the Middle East, where their products are competing with established international brands.

Yili, Asia’s largest dairy company, plans to begin selling infant formula in Southeast Asia as early as next year. Rival Feihe has already introduced its AceKid formula in Indonesia and the Philippines.

Chinese poultry companies are pursuing similar strategies, offering frozen chicken and processed products to customers seeking lower-cost supplies.

Wintop has increased the number of chickens housed in each shed from 20,000 to 120,000 over the past decade. Meanwhile, rival processor Sunner is expanding its range of marinated chicken and ready meals, with overseas sales rising 42 per cent to $135 million last year.

Chinese exporters are also exploring partnerships that could help establish local production capacity in overseas markets.

Global competitors raise concerns

China’s growing presence is putting pressure on established exporters, including Brazil, Thailand, Germany and other European producers.

Chinese chicken breast and leg-quarter products are reportedly 10 to 20 per cent cheaper than Brazilian alternatives, making them attractive to buyers in price-sensitive markets.

China has doubled its share of the European Union’s processed-poultry market to 10 per cent since 2022 and tripled its share in the United Kingdom to more than 14 per cent, according to consultancy Gira.

The expansion has prompted scrutiny from trade authorities. The European Commission launched an anti-dumping investigation into Chinese Pekin duck imports in July, following complaints from local producers about alleged unfair competition. Last month, it imposed anti-dumping duties of 41 to 67 per cent on Chinese pea protein.

Chinese chicken exports have not faced equivalent measures so far, although European authorities are monitoring developments.

Food safety remains another challenge. Past scandals have damaged confidence in some Chinese food products, making traceability, consistency and regulatory compliance important for exporters seeking long-term growth.

For global consumers, China’s expanding protein industry could mean more affordable meat and dairy products. For competing producers, however, the growing supply of lower-priced Chinese goods presents a formidable challenge.

As Chinese companies look abroad to absorb excess production, the battle for supermarket shelves is increasingly becoming a contest over price, quality and consumer trust.