Poultry Outlook Report - July 2004 - By U.S.D.A., Economic Research Service - This article is an extract from the July 2004: Livestock, Dairy and Poultry Outlook Report, highlighting Global Poultry Industry data. The report indicates that Broiler meat production and Turkey production is down slightly.

Broiler Meat Production Down Slightly in May, but Estimate for Second Quarter Increased

Composite Broiler Price Percent change from previous month

U.S. broiler meat production was up over 5 percent in the first quarter of 2004 and the revised estimate for the second quarter is now 8.525 billion pounds. This is an increase of 10 million pounds from last month and 3 percent higher than in the same period last year. This adjustment pushes the estimate for 2004 to 33.93 billion pounds, an increase of 3.6 percent from 2003.

Broiler meat production in May was down less than 1 percent from a year earlier. That decline was the result of a 1.7 percent decrease in the number of birds being slaughtered. However, the decrease in the number of birds slaughtered was partially offset by a 1-percent increase in the average liveweight of birds going to slaughter. The decrease in the number of birds going to slaughter can be attributed to the fact that May 2004 had one less working day than in May 2003. This will be reversed for June, with June 2004 having one additional working day than June 2003. Preliminary data point toward a significant increase in the amount of broiler meat produced in June due to a higher number of birds being slaughtered combined with a 1-to 2-percent increase in weight.

Weekly Broiler Slaughter Percent change from last year

Even with second quarter production now estimated to be 3 percent higher than last year, wholesale prices for most broiler products continued to be well above their year earlier levels. Over the first 6 months of 2004, prices for boneless/skinless breast meat averaged nearly $2.06 per pound, up 38 percent from the same period in 2003. Prices for whole birds also increased, with the 12-City composite price averaging 27 percent higher than in the first half of 2003. Leg quarter prices, which more greatly reflect strength in export markets, also rose, even though exports are down.

Over the first 6 months of 2004, leg quarter prices averaged 35.1 cents per pound, 61 percent higher than in 2003, but prices in June were about even with May and are expected to decline in July. With broiler production now forecast to be 3.3 percent higher in the third quarter than last year, price increases for most products are expected to slow down. However, prices, for export sensitive parts, like leg quarters, may strengthen if exports resume to major markets like China.

Broiler exports in May were 345 million pounds, down 11 from the previous year and considerably lower than average shipments over the last several years. Over the first 5 months of 2004, broiler shipments were down 11 percent from the same period in 2003. Even though the quantity of broiler exports was lower, it was offset by higher prices. The total value of broiler exports over the first 5 months of 2004 is $640 million, up 23 percent from the previous year. Most of the decline in broiler exports through May has come from lower shipments to Russia, and Hong Kong/China which accounted for 42 percent of all broiler exports in 2003 and through May were down 7 and 71 percent, respectively.

Turkey Production Falls in May

Weekly Turkey Slaughter Percent change from last year

Domestic turkey production totaled 448.9 million pounds in May, down 6.8 percent from last year. Turkey production has fallen in 6 of the last 7 months and so far in 2004 is down 5.8 percent from 2003.

With hatchery numbers continuing to point to lower production in the future, the estimate for second quarter 2004 production was reduced to 1.36 billion pounds, down about 80 million pounds from a year the second quarter in 2003.

The declines in turkey production have begun to raise prices for a number of turkey products. Prices for whole birds have been strengthening over the last several months and averaged 66.6 cents in the second quarter, up 6 cents (almost 10 percent) from last year. Prices for other products have also risen and with continued lower production, prices are expected to continue to strengthen in the second half of the year.

Retail Turkey Price Percent change from previous month

Turkey exports totaled 34 million pounds in May, down 15 percent from the previous year. Over the first 5 months of 2004, turkey exports have been 141 million pounds, down 20 from the same period in 2003.

As with broilers most of the decline has come from lower shipments to Hong Kong/China and Russia. Also like broiler exports, higher prices have more than offset the lower volume. Through May, the value of turkey exports totaled $23 million, up 17 percent from the previous year.

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For more information view the full Livestock, Dairy and Poultry Outlook - July 2004 (pdf)

Source: Livestock, Dairy and Poultry Outlook - U.S. Department of Agriculture, Economic Research Service - July 2004