Middle East chicken prices under pressure as diverted cargo redirected to UAE

Middle East chicken prices declined in recent weeks as cargo originally destined for Iran and other regional markets was redirected to the UAE, creating oversupply pressure that particularly impacted griller segments, according to market participants.

Platts, part of S&P Global Energy, assessed the Middle East chicken griller price at $2,200/metric ton CIF Jebel Ali July 14, down $40/mt from the previous assessment and $200/mt since Platts began assessing grillers on May 1.

The price weakness comes as heavy grillers weighing 1.1 kilograms or more were diverted from their original destinations in Iran to ports outside the Strait of Hormuz, according to a regional Dubai-based market participant.

This oversupply coincided with seasonally lower summer demand, intensifying downward pressure on the delivered duty-paid/delivered at place market as regional Brazilian producers cut prices to clear inventory, leading to a notable decline from previous levels and subsequently weighing on the CIF assessments.

Griller prices for products below 1,300 g were assessed at $2,200/mt CIF Jebel Ali with all fees included and delivered via Koh Fakkan, according to market sources.

Market dynamics

The griller price decline has been steeper than that of other chicken products, amid an oversupply situation that is putting pressure on producers selling on DDP terms in the local Brazilian market. This domestic price weakness has further affected CIF import prices, as suppliers adjust to competitive pressures.

Breast and shawarma products have also experienced slight price reductions due to summer sales weakness, though the decline has been less pronounced than for grillers.

Both products are currently trading at similar levels around $2,800/mt CIF, including fees, according to market participants. The narrow spread between these premium cuts reflects changing processor demand patterns that have supported shawarma values relative to traditional pricing levels.

In contrast, chicken leg quarters and trays remained stable, with unchanged pricing, suggesting oversupply imbalances are concentrated to key products. Platts assessed Middle East CLQ at $1,520/mt on July 14.

Logistical challenges

The complex logistics environment in the region has added uncertainty to pricing assessments, with shipping companies offering varying surcharge structures and transshipment arrangements. Some shipping lines provide transshipment services while others do not, creating different cost structures across suppliers and making precise price comparisons challenging.

Market participants noted that each supplier negotiates independently with shipping lines, leading to different fee structures that can affect final delivered costs. Khor Fakkan remains the primary entry port for chicken imports, with most cargoes requiring transshipment to reach final destinations in Dubai and other UAE markets.