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Egg forecast increased as prices fall

Egg prices expected to increase in line with higher demand stemming from holiday baking season.

The U.S. Department of Agriculture estimated table egg production in August at 688 million dozen, 1.8% higher than last August. USDA economist Kim Ha said the growth was comprised of a marginal increase in the table egg layer flock and a 1.7% increase in the table egg lay rate.

In 2019, producers have maintained a highly productive layer flock, with year-to-date table eggs per layer averaging 80.3 eggs per 100 layers per day, about 1.8% higher compared to the same period last year, USDA noted.

“For the remainder of the year, it is anticipated that producers will maintain a layer flock similar in size to last year’s flock and will retain the most productive birds,” Ha relayed.

Based on expectations for a higher-than-expected lay rate in the second half, USDA raised the Q3 and Q4 table egg production forecasts were increased to 2.040 million dozen and 2.065 million dozen, respectively.

USDA raised the 2020 table egg production forecast to 8.225 million dozen, less than 1% higher than the 2019 forecast. Based on expectations for increased broiler-type layers to support increased broiler production, the 2020 hatching egg forecast was revised up to 1.195 million dozen, more than 1% higher than the 2019 forecast.

table egg oct. 2019.png

Similar to broilers, Ha said the anticipated increase in production is expected to increase ending stocks.

According to USDA, the August ending egg stocks (cold and dried) reached 101.6 million dozen (shell egg equivalent), nearly 38% higher year over year. Ha said the increase in stocks was driven by accumulating dried stock inventories, which added 24.1 million dozen (shell egg equivalent) to egg stocks compared to August 2018 (versus frozen eggs, which added 3.8 million dozen). The expected increase in production and accumulating dried egg inventories are the basis for increasing the 2019 ending stocks forecast to 104 million dozen, and the 2020 ending stocks forecast was raised to 108 million dozen.

USDA reported that after climbing 61 cents in August the wholesale egg price (New York, Grade A Large), prices decreased by 44 cents from $1.18/dozen to 74 cents per dozen, where it remained for the end of September and into October. September egg prices averaged 90.35 cents per dozen, 17% lower than last September.

During the last quarter, Ha said egg prices are expected to increase in line with higher demand stemming from the holiday baking season.

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