US chicken production seen up 1%

The USDA is estimating 2010 broiler meat production to rise about 1% from last year while turkey production is expected to decline 1.6%.

 

Broiler meat production this year is expected to total 35.9 billion pounds, while turkey production will reach 5.58 billion pounds, the USDA said in a livestock and poultry outlook released Friday (Feb 19) at its annual Agricultural Outlook Forum.

 

Growth in broiler meat production is expected to build gradually during each of the first three quarters and then expand more rapidly in the fourth quarter, the USDA said.

 

Turkey production is expected to continue declining until the second half of the year, and increases may not overtake first-half declines, according to the report.

 

Chicken prices are expected to remain firm through the third quarter, and then decline a few cents as broiler meat production growth increases in the last quarter.

 

The 12-city wholesale broiler price is forecast to average 77-82 cents a pound in 2010, compared with an average of 77.6 cents in 2009, the USDA said. Whole broiler prices have moved to the low 80-cent range since the beginning of the year.

 

Chicken parts prices are expected to hold steady during 2010 as production gains are modest. However, any extended trade disruptions could dampen prices for broilers and broiler parts.

 

Boneless/skinless breast meat prices in the Northeast averaged US$1.30 a pound in 2009. The January 2010 price was about US$1.27 a pound, which is the highest price since September 2009 when prices began to weaken seasonally.

 

Bulk leg quarter prices in the Northeast averaged about 39 cents per pound in 2009. Leg quarter prices were about 37 cents per pound in January 2010.

 

US broiler meat exports for 2010 are forecast to decline to about 5.83 billion pounds, a decline of nearly 15% from last year, the USDA said.

 

Although the exchange rate outlook for 2010 continues to support broiler meat shipments, exporters face additional challenges that are expected to constrain shipments this year, the USDA said. For 2010, Russia cut its poultry quota to 780,000 tonnes, or 1.7 billion pounds, from 952,000 in 2009. Of that 2010 quota amount, the US is allocated 600,000 tonnes, or 1.3 billion pounds.

 

The USDA said with Russia's bid to become self-sufficient in meat production, further quota cuts are scheduled through 2012.

 

Complicating the export picture, however, is Russia's ban on chlorine treatments of poultry, which took effect January 1. Nearly all US producers use chlorine treatments in an effort to control pathogens, so US exports have been shut out of Russia since the ban took effect.

 

USDA Under Secretary Jim Miller said Thursday (Feb 18) that progress has been made toward resolving the chlorine-treated poultry dispute, but a second round of high-level talks between the US and Russia would be needed. Miller said he expected such talks likely would occur in Moscow soon.

 

Another issue affecting trade is an import duty, ranging from 43%-105%, that China began applying to US chicken imports on February 13. The Chinese government said the action was necessary because US dumping was harming the domestic poultry industry.

 

Despite a decline in turkey production, turkey exports for 2010 are forecast to rise about 2% to 545 million pounds, but will still be below the record 676 million pounds exported in 2008.

 

Last year, turkey exports had fallen 21% due to declines in shipments to Mexico, the largest US turkey market, as well as to China, Russia, and Taiwan.