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U.S. Broiler and Turkey Exports, January-May 2024.

OVERVIEW

Total exports of bone-in broiler parts and feet during January-May 2024 attained 1,376,146 metric tons, 11.6 percent lower than in January-May 2023 (1,556,051 metric tons). Total value of broiler exports decreased by 5.6 percent to $1,862 million ($1,973 million).

Total export volume of turkey products during January-May 2024 attained 86,673 metric tons, 20.2 percent more than in January-May 2023 (72,137 metric tons). Total value of turkey exports increased by 10.1 percent to $252 million ($229 million).

Unit price for the broiler industry is constrained by the fact that leg quarters comprise over 96 percent of broiler meat exports by volume (excluding feet). From the first quarter of 2021 through 2022, unit value of leg quarters increased in unit value consistent with international demand followed by a decline in 2023. Leg quarters represent a relatively low-value undifferentiated commodity lacking in pricing power. Exporters of commodities are subjected to competition from domestic production in importing nations. Generic products such as leg quarters are vulnerable to trade disputes and embargos based on real or contrived disease restrictions. To increase sales volume and value the U.S. industry will have to become more customer-centric offering value-added presentations with attributes required by importers. Whether this will increase margins is questionable given the by-product origin of leg quarters. A more profitable strategy for the U.S. industry would be to develop products using dark meat to compete with and displace pork in the domestic market.

HPAI is now accepted to be a panornitic affecting the poultry meat industries of six continents with seasonal and sporadic outbreaks. The incidence rate and location of cases in the U.S. limits eligibility for export depending on restrictions imposed by importing nations

Ongoing outbreaks of African swine fever in China and Southeast Asia from early 2019 and Europe from 2010 onwards reduced the availability of pork. In addition, disruptions in chicken production and logistics due to COVID restrictions decreased availability of protein with international repercussions on trade in chicken and pork. The demand for pork imports to China has diminished with restoration of domestic hog production to the extent of overproduction. Mild oversupply is evident in the white-feathered broiler sector with implications for exports other than feet extending into 2024.

EXPORT VOLUMES AND PRICES FOR BROILER MEAT

During January-May 2024 the National Chicken Council (NCC), citing USDA-FAS data, documented exports of 1,393,414 metric tons of chicken parts and other forms (whole and prepared), down 10.9 percent from January-May 2023. Exports were valued at $1,920 million with a weighted average unit value of $1,378 per metric ton.

The NCC breakdown of chicken exports for January-May 2024 by proportion and unit price for each category compared with the corresponding months in 2023 (with the unit price in parentheses) comprised:-

• Chicken parts (excluding feet) 4%; Unit value $1,289 per metric ton ($1,218)
• Prepared chicken 0%; Unit value $4,176 per metric ton ($4,300)
• Whole chicken 6%; Unit value $1,627 per metric ton ($1,608)
• Composite Total 0%; Av. value $1,378 per metric ton ($1,280)

The following table prepared from USDA data circulated by the USAPEEC, compares values for poultry meat exports during January-May 2024 compared with the corresponding months of 2023:-

COMPARISON OF U.S. CHICKEN AND TURKEY EXPORTS

JANUARY-MAY 2024 COMPARED TO 2023

BROILER EXPORTS

Total broiler parts, predominantly leg quarters but including feet, exported during January-May 2024 compared with the corresponding months in 2023 declined by 11.6 percent in volume and 5.6 percent in value. Unit value was 6.7 percent higher to $1,353 per metric ton.

During 2023 exports attained 3,635,178 metric tons valued at $4,739 million, down 4.2 percent in volume and down 9.2 percent in value compared to 2022. Unit value was down 9.5 percent to $1,284 per metric ton

Broiler imports in 2023 were projected to attain 72,000 metric tons (158 million lbs.)

The top five importers of broiler meat represented 46.1 percent of shipments during January-May 2024. The top ten importers comprised 64.4 percent of the total volume reflecting concentration among the significant importing nations but with a decline in the importance of China.

During January-May 2024 Mexico was the first-ranked importer by volume and value with 305,255 metric tons representing 22.2 percent of export volume up 3.2 percent from January-May 2023. Value at $382 million was 20.5 percent of the total for exported broiler products during January-May 2024 and up 18.3 percent from 2023, but with a 14.5 percent increase in unit price to $1,252 per metric ton. During May 2024 volume was up 11.5 percent to 65,295 metric tons and value was higher by 23.8 percent from May 2023 to $86.9 million.

Cuba was the 2nd-ranked importer based on volume during January-May 2024 with 105,941 metric tons valued at $124.7 million. Exports were down 4.0 percent in volume but up 16.7 percent in value compared to January-May 2023. Unit price was $1,177 per metric ton. During May 2024 exports were down 27.7 percent in volume to 17,784 metric tons but up 7.7 percent in value to $23.7 compared to May 2023.

Taiwan was 3rd ranked as an importer during January-May 2024 with 86,051 metric tons valued at $105.0 million down 36.9 percent and 41.1 percent in volume and value respectively, compared to the previous year. Unit price was $1,220 per metric ton. During May exports were down 60.2 percent in volume to 13,156 metric tons and down 65.4 percent in value to $15.5 compared to May 2023.

During January-May 2024 exports to China, 4th-ranked by volume and 2nd ranked by value represented 5.7 percent by volume and 8.2 percent by value of shipments. Exports were down 62.3 percent in volume to 78,710 metric tons and down 54.3 percent in value to $154.3 million compared to January-May 2023. Unit price was $1,960 per metric ton up 19.6 percent. During May 2024 China ranked 5th among importers based on volume receiving 12,374 metric tons down 70.9 percent from May 2023. Exports in May 2024 were valued at $25.0 million down 62.8 percent with a unit price of $2,020 per metric ton confirming the predominance of feet in relation to other products.

During 2023, 405,313 metric tons of U.S. broiler products were shipped to China, valued at $711,172 with an average unit value of $1,755 per metric ton. A breakdown of product categories and prices was provided by USAPEEC. Paws and feet represented 68.5 percent of volume and 73.1 percent of value with a unit price of $1,871 per metric ton. Legs and leg quarters comprising 22.6 percent of volume and 12.8 percent of value were priced at $990 per metric ton below the $1,302 average for all U.S. exports excluding China. Wings comprised 4.6 percent of volume and 5.7 percent of value with a unit price of $2,190 per metric ton. All other poultry products (including 4 tons of duck meat) amounting to 4.2 percent of volume and 8.4 percent of value attained an average unit price of $3,485 per metric ton

During January-May 2023 exports to Hong Kong, 11th ranked by volume, but 7th by value, increased by 166 percent in volume to 38,964 metric tons and 143 percent in value to $59.4 million with a unit price of $1,525 per metric ton. In 2022 and 2023 unit prices were $1,834 and $1,671 per metric ton respectively. Accordingly consignments are presumed to comprise a high proportion of feet with assumed transshipment to the Mainland as in past years.

During January-May 2024 nations gaining in volume compared to the corresponding period in 2023 (with the percentage change indicated) in descending order of volume with ranking indicated by numeral were:-

1. Mexico, (+3%); 5. Guatemala, (+2%); 6. Philippines, (+2%); 8. Viet Nam, (+23%) 9. UAE, (+50%) and 11. Hong-Kong, (+171%); 12. Georgia, (+9%) and 13. Iraq, (+21%)

Losses during January-May 2024 offset the gains in exports with declines for:-

1. Cuba, (-4%); 3. Taiwan, (-37); 4. China, (-62%); 7. Canada, (-2%); 10.Angola, (-5%); 14. Haiti, (-30%); 15. Dominican Republic, (-6%) and 16. Congo –Braz., (-31%).

TURKEY EXPORTS

The volume of turkey meat exported during January-May 2024 increased by 20.2 percent to 86,673 metric tons from January-May 2023 and value was 10.1 percent higher to $251.9 million compared to January-May 2023. Average unit value was 8.3 percent lower to $2,906 per metric ton.

Imports of turkey products attained 38,640 metric tons in 2023.

For the entire year of 2023 export volume increased by 20.2 percent to 221,098 metric tons compared to 2022 and value fell by 2.0 percent to $620 million reflecting an 18.5 percent decrease in unit value to $2,829 per metric ton.

Mexico was the dominant importer of turkey products during January-May 2024 with 66,223 metric tons representing 76.4 percent of total volume of 86,673 metric tons. Value at $187.3 million was 74.3 percent of the total. Volume was 34.1 percent higher and value was 14.0 percent higher than for January-May 2023. Unit value was down 14.9 percent to $2,828 per metric ton. During May Mexico imported 14,405 metric tons valued at $42.2 million, up 18.9 percent in volume and 22.3 percent in value.

Imports by the nations of the Caribbean (6,554 metric tons); Canada (2,465); Central America, (3,402), sub-Saharan Africa (2,624) and East Asia (2,094) collectively comprised 17,139 metric tons of turkey products in January-May 2024 representing 19.7 percent of volume and 21.6 percent of total export value amounting to $51.5 million. Unit price was $3,004 per metric ton. Regional unit prices per metric ton ranged from $1,562 for sub-Saharan Africa to $3,772 for Canada.

During January-May 2024 nations increasing volumes of purchases, albeit over a small base, compared to the corresponding months in 2023 with ranking comprised:-

1. Mexico, (+34%); 4. Leeward-Windward Islands, (+35%); 5. South Africa, (1,013%) and 6. Dominican Republic, (+156%)

Nations reducing the volume of imports over January-May included:-

1. Canada, (-17%) and 5. Jamaica, (-32%)

PROJECTION FOR 2024 and 2025

The July 18th 2024 Livestock, Dairy and Poultry Outlook Report, lowered 2024 exports of broiler products to 3.068 million metric tons (6,744 million lbs.). This value represents 14.4 percent of the projected production of 21.227 million metric tons (46,700 million lb.) of broiler RTC by the U.S. industry.

For 2025 exports of broiler products were forecast at 3.084 million metric tons (6,784 million lbs.), equivalent to 14.6 percent of forecast annual production of 21.614 million metric tons (47,550 million lbs.)

Projected export of turkey products in 2024 will be 240,910 metric tons, (530 million lbs.) or 10.0 percent of annual production of 2.400 million metric tons (5,234 million lbs.).

For 2025 export of turkey products in 2025 is forecast at 237,901 metric tons (515 million lbs.) equivalent to 9.7 percent of forecast annual production of 2.418 million metric tons (5,320 million lbs.)

It is important to recognize that exports of chicken and turkey meat products to our USMCA partners amounted to $1,264 million in 2021, $1,647 million during 2022 and $1,696 in 2023. It will be necessary for all three parties to the USMCA to respect the terms of the agreement since punitive action against Mexico or Canada on issues unrelated to poultry products will result in reciprocal action by our trading partners to the possible detriment of U.S. agro-industries. This is especially important as Mexico has elected a new Presidenta and a change in the Government of Canada is predicted.

The emergence of H5N1strain avian influenza virus with a Eurasian genome in migratory waterfowl in all four Flyways during 2022 was responsible for sporadic outbreaks of avian influenza in backyard flocks and serious commercial losses in egg-producing complexes and turkey flocks but to a lesser extent in broilers. The probability of additional extensive outbreaks of HPAI over succeeding weeks appears less likely as spring migration of waterfowl has concluded. Incident cases in 2024 comprised 1.3 million commercial-level meat turkeys and 70,000 breeders through July 12th. Additional outbreaks affecting egg-production and turkeys will be a function of shedding by migratory and domestic birds and possibly mammals. The extent of protection of commercial flocks at present relies on the intensity and efficiency of biosecurity including wild-bird laser repellant installations, representing investment in structural improvements and operational procedures. These measures are apparently inadequate to provide absolute protection, suggesting the need for preventive vaccination in high-risk areas for egg-producing, breeder and turkey flocks.

The application of restricted county-wide embargos following the limited and regional cases of HPAI in broilers with restoration of eligibility 28 days after decontamination has supported export volume for the U.S. broiler industry. Exports of turkey products were more constrained with plants processing turkeys in Minnesota, the Dakotas, Wisconsin and Iowa impacted. Most nations have now lifted embargos that were previously placed on entire states or counties following outbreaks in the 4th quarter of 2024 as the WOAH mandated post-decontamination period has expired. The challenge will be to gain acceptance for vaccination based on intensive surveillance. It is now accepted that H5N1 HPAI is panornitic in distribution among commercial and migratory birds across six continents. The infection is now seasonally or regionally endemic in many nations with intensive poultry production, suggesting that vaccination will have to be accepted among trading partners as an adjunct to control measures in accordance with WOAH policy.

The live-bird market system supplying metropolitan areas, the presence of numerous backyard flocks, fighting cocks and commercial laying hens allowed outside access, potentially in contact with migratory and now some resident bird species, all represent an ongoing danger to the entire U.S. commercial industry. The live-bird segments of U.S. poultry production represent a risk to the export eligibility of the broiler and turkey industries notwithstanding compartmentalization for breeders and regionalization to counties or states for commercial production.