The poultry industry is one of our three key protein industries at Marel. With the most complete product range and the largest installed base worldwide, Marel Poultry is a leading global provider of advanced food processing systems and services for broilers, turkeys and ducks. Marel Poultry contributed EUR 560 million in revenue in 2017, or 54% of total revenues, translating to an EBIT of 19.5%.
The consumer value of the global poultry, meat and fish market is currently estimated to be around EUR 1,200 billion, with the poultry market accounting for EUR 400 billion. More specifically for Marel, the market for food processing equipment for poultry, meat and fish and its maintenance is estimated to be around EUR 10 billion. Of this, poultry processing equipment is estimated to be around EUR 3 billion – and is expected to grow annually by 4-6%.
The year 2017 saw Marel Poultry go from strength to strength. Our state-of-the-art, high-tech processing systems supported our strong position in the market. Our teams worked diligently on maintaining both our good customer connections and our innovative, solid equipment offering. The most prominent trend we saw in the dynamic 2017 market was the diversification in broiler breeding, as the concept chicken gained considerable ground on the high feed-to-meat ratio broilers that have been the standard in previous decades. The concept chicken is a slower growing – sometimes heritage – breed that is organic and marketed under names like ‘Better Life’, ‘Chickens of Tomorrow’ or ‘Label Rouge’ in Europe. The same trend has been seen in the US, while the Chinese market still prefers the standard yellow broilers.
The increasing focus on sustainability in "local breeding and eating", means that current processing facilities need to be able to receive and process a more diverse range of birds, both in terms of size and weight. To meet this requirement, Marel Poultry has focused on helping processors become more flexible than ever. Our solutions are designed to provide not only the throughput, yield and quality that the market demands but also ensure the diversity and flexibility needed for current processing challenges.
Faced with the need for greater investments in advanced food processing equipment and systems, the poultry industry requires partners who are ready to listen to and work with them; partners that can offer the technology that delivers the throughput, quality and yield they need. Marel Poultry has proven to be that partner.
Sales were good in 2017. Our approach is always customer-oriented, aimed at preparing our clients for the future. Driven by strong product development, we saw our regular sales grow significantly. In addition, Marel was also involved in large, greenfield projects and strengthening partnership initiatives.
Our upselling strategy worked well for both Marel Poultry and our customers in 2017. Marel Poultry always keeps the big picture in mind when selling solutions. It matters to us that our customers can seamlessly integrate the machinery they purchase and easily add new equipment to their line when they see the benefits of the initial installation. Our systems are designed to make these additions smooth and easy to perform. Upselling from a standalone machine to a completely new department is no exception.
Marel emphasizes the synergies arising from transferring methodologies and solutions across industries. Our logistics and overhead deboning systems are great examples of just this. Developments in logistic solutions initiated by Marel Poultry are now welcomed by other industries. The modular configuration of our SystemFlex intelligent conveyor system has been widely acclaimed in the poultry industry. This new logistic concept has taken automation to a completely new level and found its way across industry boundaries. The same goes for the overhead conveyor deboning process. Originating in the poultry industry’s FHF and AMF deboning systems, the DeboFlex meat solution adopted the same inline processing concept.
We are constantly seeking ways to automate the production process. In 2017, Marel Poultry rolled out its first ATLAS supply system. Developed to offer full control of all aspects of live bird handling, the system operates in an efficient yet humane manner to ensure animal welfare. Its connection to the CAS SmoothFlow anesthetization is superior to that of all other existing systems. When it comes to animal welfare, the induction phase is the most important of all. Together, ATLAS and CAS SmoothFlow ensure that the slaughtering process is humane and complies with most halal requirements.
The new AMF-i breast filleting solution is the result of continuous development. This year we saw it reach a new level of perfection, thanks to its added intelligence.
Now the measurement unit of the AMF-i system automatically detects changing dimensions in incoming products. It sends its instructions to the downstream modules, which auto-adjust their settings accordingly for adaptive automatic filleting. The result is accurately filleted breast caps without human intervention.
AMF-i produces a wide range of breast fillet products for retail and industrial customers and harvests valuable by-products.
In 2017, we highlighted the fact that processors at all stages of automation benefit from the Innova Food Production Software. The software is always promoted in tandem with relevant products, enabling us to display its benefits to a broad customer base over the course of the year. Our customers require the process control and monitoring that Innova provides.
The Innova IMPAQT (Intelligent Monitoring of Performance, Availability and Quality Trends) module has been extremely well received, as customers find that it is more than just an Overall Equipment Effectiveness (OEE) application. It far exceeds the usual functionalities of OEE software by pinpointing exactly the reasons for any production losses or variations in processing in real-time.
Consumers are no longer content with using only the breast meat of carefully reared chicken and underrating the rest of the bird. Given the increasing attention being paid to sustainable production, it is entirely logical to add as much value as possible to each part of the chicken. Which is why the Marel Poultry Thigh Fillet System perfectly matches sustainability goals.
Deboning the thigh meat upgrades it to retail class A quality, equal to a breast fillet. Processors no longer need to downgrade leg meat, freeze it and ship it as a low-priced by-product. With our system, they can add optimal value to benefit both their production and their customers.
Some of our largest projects involved supermarkets around the world that are looking for complete vertical integration to keep production of primary products in their own hands. To gain full control of their value chain these companies are building their own poultry processing facilities. Our customer Coles was the first one to establish its own processing plant in Australia and others have followed suit.
In 2017, Costco Wholesale in the US planned a USD 300 million chicken processing facility in Fremont, Nebraska. Costco teamed up with Marel Poultry to realize this huge, hypermodern greenfield project. It heralds the first US installation of the ATLAS system with the CAS SmoothFlow stunning application. The facility will also include a complete Marel Poultry evisceration department, a shock/maturation air-chilling tunnel, two distribution lines with SmartWeigher and IRIS, deboning with AMF-i and SensorX quality control.
The entire factory will be tied together with our Innova Food Processing Software, a fully integrated production control and monitoring system that gives real-time overview of the entire process.
Poland remained the leading producer of poultry meat in the European Union in 2017. Our efforts in 2017 resulted in Marel Poultry becoming the poultry processing equipment supplier with the largest market share in the country. We secured orders from several leading Polish companies, which intend either to modernize their existing facilities drastically or to equip fully new greenfield plants. All facets of poultry processing are covered by our solutions and services in these plants, from live bird handling to final product packs.
Improved utilization of raw materials has become increasingly important as the world population grows and demand for protein increases. Our answer lies in the adage 'waste not, want not,' as our customers require systems that enable them to use every part of the broiler and obtain a better price for a more valuable product. Maximizing the value of every part of the chicken is therefore high on Marel Poultry’s agenda; by so doing we contribute to both internal and external sustainability goals in the industry.
Market demand for higher throughput is our division’s main growth driver. We will continue to supply technological solutions that increase automation and mechanization to realize these requirements.
Another growth driver is the demand for increased product value using an integrated inline process that can lower cost per product processed. Our approach is to create solutions that automate labor and improve yield, uptime and product quality, while increasing sustainability through lower water and energy consumption.
In 2018, global production of chicken meat is estimated to rise by 1.2% and reach 91.3 million tons. Global trade in chicken meat is expected to grow by 3.3% and reach 11.4 million tons.
The US is expected to continue to be the leading producer in 2018 with 21% of the total production, followed by Brazil with 15%.
In 2017, the European Union overtook China to become the third-largest producer of chicken meat in the world and is expected to hold that position in 2018.
Brazil continues to be the world's leading exporter of chicken meat with 4.0 million tons in 2017, expected to rise to 4.2 million tons in 2018.