Poultry Industry News, Comments & More

Broiler Week

09/06/2019

Weekly Broiler Production and Prices

Chick Placements.

The Broiler Hatchery Report released on September 6th confirmed that a total of 232.9 million eggs were set during the week ending August 31st, up five percent compared to the corresponding week in 2018. A total of 180.0 million day-old chicks were placed among the 19 major broiler-producing states during the week ending August 31st. This was one percent more than in the corresponding week in 2018. Total chick placements for the U.S. amounted to 187.7 million. Claimed average hatchability was 82.7 percent for eggs set three weeks earlier. Broiler chick placements for 2019 through August 31 st amounted to 6.54 billion, one percent more than YTD 2018.

Broiler Production

According to the September 6th USDA Broiler Market News Report (Vol. 66: No. 36) for the processing week ending August 31st 2019, 177.9 million broilers were processed during the week at an average live weight of 6.26 lbs. (6.20 lbs. last week) and a nominal yield of 76.0 percent. The number of broilers processed was 4.1 percent more than the corresponding processing week in 2018. Processed (RTC) broiler production for the week was 846.4 million lbs. (386,095 metric tons), 4.2 percent more than the corresponding week in 2018. Production YTD of RTC in 2019 is 27.06 million lbs. (12,298,026 metric tons), 2.2 percent more than in 2018 YTD.

Broiler Prices

The USDA National Composite Weighted Wholesale price on September 6 th 2019 was down 0.2 cent per lb. from the previous week to 76.1 cents per lb. compared to 82.8 cents per lb. during the corresponding week of 2018; 80.9 cents per lb. for August 2019 and 86 cents per lb. for the three-year average.

The USDA Southern States (SS) benchmark prices in cents per lb. (rounded to nearest cent) as documented in the Broiler Market News Reports September 6th 2019 are tabulated with a comparison with the previous week:-

Product

USDA SS. Past week

Cents/lb.

USDA SS. Previous week

Cents/lb.

 

Difference.

%

Whole Index

51

50

-2.0

Tenderloins

163

164

+0.6

B/S Breast

100

97

-3.0

Whole Breasts

84

83

-1.2

B/S Thighs

109

108

-0.9

Whole Thighs

46

49

+6.5

Drumsticks

32

32

Unchanged

Leg Quarters

38

38

Unchanged

Wings (cut)

187

185

-0.5

.

The USDA posted live-weight data for the past week ending August 31 st 2019 and YTD 2019 were:-

Live Weight Range (lbs.)

<4.25

4.26-6.25

6.26-7.25

>7.76

Proportion past week 2018 (%)

22

27

27

24

Change from 2017 YTD (%)

-4

+2

+4

+8

During the past week broilers for QSR and food service (live, 3.6lb. to 4.3lb.) represented 22 percent (last week 18 percent) of processed volume.

On September 2nd 2019 cold storage holdings at selected centers amounted to 77,794 lbs., 0.9 percent more than an inventory of 78,510 lbs. on August 1st 2019.

According to the most recent August 22nd USDACold Storage Report, issued monthly, stocks as of July 31 st 2019 compared to July 31st 2018 showed differences with respect to the following categories:-

  • Total Chicken category declined by 3.1 percent to 850.4 million lbs. (386,574 metric tons) on July 30th 2019 compared to 877.6 million lbs. (398,931 metric tons) on July 31st 2018

  • Leg Quarters were down by 21.1 percent to 64.3 million lbs. consistent with the data on exports albeit at lower unit revenue as documented in the monthly export report.

  • The Breasts and Breast Meat category was up by 3.7 percent to 176.8 million lbs. despite increased domestic demand from food service and retail.

  • Wings showed a 26.9 percent decrease, contributing to a stock of 65.0 million lbs. reflecting seasonal demand and increased consumption presumably during featured sports events.

  • Paws and Feet decreased by 26.9 percent to 27.6 million lbs. as a result of variable but increased demand from Hong Kong but at a progressively lower unit price. (See Meat Export Report under the STATISTICS Tab)

  • It is noted that the Other category comprising 384.6 million lbs. represented a significant 45.2 percent of inventory on July 31st 2019. The high proportion in the Other category suggests further classification or re-allocation by USDA to the designated major categories.

Comments

Placements of chicks and level of slaughter are assumed to be consistent with USDA projections.

The outbreak of of velogenic viscerotropic Newcastle disease in California appears to be coming to an end with one new case diagnosed on August 14 th and a second on August 31st but with no incident cases during the previous eight weeks. There is every possibility of a reemergence of cases in the fall either through introduction from Mexico or from transient carriers in the fighting cock population. There were 450 diagnoses of vvND involving mostly "backyard flocks" (a euphemism for fighting cocks) as of August 16 th 2019. Confirmed and documented cases were located in in San Bernardino (142), Los Angeles (45), Riverside (260), Alameda, San Diego (1) and Ventura (1) Counties. The highest concentrations in San Bernardino and Riverside Counties comprised clusters in close proximity. A diagnosis of vvND was made during the week of March 11th in a backyard flock (size and type not specified by the CDFA) near Redwood City in Alameda County representing extension of infection to Northern California. This case was apparently restricted to the index farm.

A total of 62 cases were identified in August 2018 compared with 20 in September, 18 in October and 17 in November. A surge in cases occurred in December with 43 confirmed followed by 86 cases in January 2019, 48 in February, 22 in March, 17 during April and 20 in May. In mid-November 2018 the State Veterinarian for California announced a pre-emptive depopulation of all backyard poultry in an affected cluster in each of three counties. This probably led to predictable and unintended consequences. On January 18 th 2019 a diagnosis of vvND was made in Utah County, UT. Preliminary investigation suggested that movement of fighting cocks from southern California was responsible for introduction of infection into the flock of 200 birds. A diagnosis of vvND was made in a flock of "pet birds" (a new euphemism for fighting cocks?) in Coconino County AZ. (near Flagstaff) during early April. USDA believes that this case is connected with Southern California outbreaks since the isolate was homozygous with the endemic strain in fighting cocks in the four-County California region.

It is understood that $45 million was assigned for eradication although the objective of control of endemic vvND in game fowl could have been achieved by hyperimmunization rather than playing "whack-a-mole" Editorials in CHICK-NEWS on December 24th and March 1st were posted dealing with the ongoing outbreak. (see EGG-NEWS and CHICK-NEWS under the SEARCH tab entering "Newcastle disease").

Mexico has recognized the OIE principle of regionalization after intensive negotiations between SENASICA and U.S. counterparts in USDA-APHIS assisted by USAPEEC. Exports of broiler parts, fertile eggs and breeding stock should not be impeded unless there is extensive dissemination of vvND with involvement of the commercial poultry industry in central or northern California or adjoining states.

CHICK-NEWS previously commented on the possible impact of failure to reconcile differences to achieve an equitable extension to the NAFTA agreement. Provisional agreement was reached at the end of August in negotiations between the U.S. and Mexico. An eleventh-hour agreement with concessions on all sides was concluded on September 30th and signed on November 30th at the G-20 Meeting. This has created a trilateral successor to NAFTA entitled the USMCA. The tripartite agreement has yet to be ratified by the legislatures of Canada and the U.S. The Senate of Mexico approved the Agreement on Wednesday 19th June.

Broiler exports to Mexico during 2018 attained 651,178 metric tons. This represented 20.3 percent of export volume and 16.4 percent of export value (amounting to $517 million) of the total year-to-date export value of $3.15 billion. In the absence of either NAFTA or the newly concluded USMCA equivalent, tariffs on chicken could have risen to 75 percent of value creating a non-competitive situation favoring Brazil and Argentina. Fifth-ranked Canada imported 141,257 metric tons of broilers and parts during 2018 valued at $351.7 million. Collectively our NAFTA/USMCA neighbors imported broiler products to the value of $907 million in 2017 and $869 million during 2018. The USMCA will still have to be ratified by the legislatures of Canada and the U.S. hopefully during 2019. Ratification appears to be advancing after the tariff on steel and aluminum imported from Canada and Mexico was rescinded by the U.S. The threat of a progressive tariff on all imports from Mexico in an attempt to "encourage" participation in limiting northward migration of illegal immigrants announced on May 30th has been deferred but would have blocked ratification had it been implemented.


 
Copyright 2019 Simon M. Shane