Markets in 60 seconds: 7/29/13

Markets in 60 seconds: 7/29/13

Egg production: According to U.S. Department of Agriculture data, egg production last month totaled 7.75 billion, up 3% from last year. Table egg production tallied 6.68 billion, while hatching eggs totaled 1.07 billion. The total number of layers in the U.S. as of July 1 was 344 million, up 2% from last year. The rate of lay per day averaged 74.6 eggs per 100 layers, up 1% from July 1, 2012. Producers are clearly planning on taking advantage of improving feed prices. Egg-type chicks hatched during June totaled 40.9 million, up 5% from last June; eggs set were up 5% at 38.3 million, and placements of chicks for future hatchery supply flocks grew 59% from last year to 189,000.

Cold storage: USDA released its latest "Cold Storage" report July 22, noting that total red meat supplies fell 8% in June and are now down 2% from last year. Pork supplies are particularly smaller than they were a year ago, with frozen pork stocks down 14% from last month and down 5% from 2012. Pork belly stocks as of June 30 were down 22% for the month and were 13% smaller than last year. Beef stores, on the other hand, were up 3% from last year despite a small decline from the May storage data. Total frozen poultry supplies at June's end were up 3% from the previous month, and running 3% larger than a year ago. Chicken stocks fell 2% during June but were still 3% larger than last year. Turkey stocks actually grew 9% during the month and were up 4% from June 30, 2012. Cheese stocks were up 5% from 2012, and butter stocks were up 33%.

Stunning label: Reports from the Netherlands indicate that government leaders are working to create a specific label for meat produced from livestock slaughtered without stunning. Pushing for the European Union to adopt the measure at a July EU Council of Ministers meeting, the Netherlands said consumers need greater transparency with regard to halal and kosher meat. Slaughter without stunning is illegal in some EU member states, but the practice is allowed for religious reasons in several countries, including the U.K. The Netherlands is calling for the EU to require meat from animals not stunned prior to exsanguination to be labeled as such. The European Commission has agreed to study the issue of labeling specific slaughter methods, and the Dutch government asked the commission to "proceed rapidly" with the study and to formulate a proposal for addressing the labeling issue. The study would examine to what extent consumers are interested in such information and evaluate the potential economic consequences of a mandatory labeling scheme.

Milk production: Milk production was up 1.6% in June, according to the latest report from USDA. Production in the 23 major milk-producing states totaled 15.8 billion lb. USDA revised its May estimate of production to 16.6 billion lb., a 1.1% increase over last year. For the April-to-June quarter, production ran 0.9% larger than last year, at 52.0 billion lb. Due to sequestration, USDA's milk production data now only include aggregate figures; no information on cow numbers or milk per cow is being released. Rice Dairy milk analyst Katie Krupa noted last week that while the supply isn't slowing down, milk prices are moving higher. While the milk/feed margin for the second half of the year is now projected to be just under $10 — what she described as a historically high level — increasing supplies could curtail future profits. "I am concerned that milk production will continue to increase and we will outpace demand at some point in the next 6-12 months," she wrote, advising producers to consider locking in some of those prices while the proverbial iron is hot.

Volume:85 Issue:30

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