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Turkey production lower, prices rising

Turkey production lower, prices rising

Exports account for 11% of production in June -- higher than most of 2018 but below 12% recorded in prior month.

The U.S. Department of Agriculture reported that turkey production in June totaled 474 million lb., a 2% decline from May 2018. However, on a daily average slaughter basis, production was 2.5% higher than the prior year.

According to USDA’s “Livestock, Dairy & Poultry Outlook,” hatchery report data for June were mixed, with a year-over-year decline of 5% in poults placed, a 2% decline in poults hatched and a 2% increase in the number of eggs in incubators on the first of the month (July 1).

“Although production remains down year to date relative to the same period in 2018, turkey ending stocks in cold storage as a percentage of monthly production have been below 2018 levels since April,” the agency said.

USDA reported that ending stocks at the end of June 2019 were 4% lower than in June 2018.

USDA revised turkey production for 2019, increasing it by 20 million lb. from last month’s forecast to 5.886 billion lb. -- less than 0.5% above the 2018 level. Turkey production in 2020 is expected to total 5.930 billion lb. If realized, USDA said production would be not even 1% higher than 2019.

Prices continue rising above 2018 levels

The latest price data, covering the week ending Aug. 10, 2019, showed frozen whole hen prices at 92 cents/lb. While prices are still below pre-2018 levels, USDA said the upward price trend since the beginning of the year strongly suggests a return to the seasonal price patterns once typical in the turkey market.

In 2019, turkey prices are expected to average 88.5 cents/lb., 10% higher than 2018. In 2020, turkey prices are projected to average 90 cents/lb., 2% higher than in 2019.

wholesale hen turkey prices.png

Exports grow again

June 2019 turkey exports were almost 8% higher than a year earlier, totaling 52 million lb., according to the USDA report.

With production flat relative to year-earlier levels, the export market is increasing its share of total utilization, the agency noted.

In June, exports accounted for 11% of production -- higher than most of 2018 but below the 12% proportion recorded in May 2019.

According to USDA, Mexico remains the leading destination for U.S. turkey shipments, with 32 million lb. shipped in June, up 2% from a year earlier and comprising 61% of all U.S. shipments.

USDA said the year-over-year growth in exports to Mexico in June was only the second period of growth (following May 2019) since October 2018 and only the third since April 2018.

In 2019, total turkey meat exports are expected to total 627 million lb., 3% higher than in 2018. In 2020, turkey exports are expected to total 630 million lb., which, if realized, would be almost 0.5% higher than in 2019, USDA said.

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