May 2, 2007


High feed prices dampen US broiler output 



High feed prices continue to dampen enthusiasm to expand broiler output in the first-quarter of 2007, according to a March 30 report from the USDA.


First-quarter 2007 production is estimated to be down 2 percent from a year ago while year-to-date weekly chick placements are running more than 1 percent below year-ago levels. The report said that the trend is likely to continue next season.


Broiler exports for 2006 were 1.3 percent above 2005.


Russia absorbs about 30 percent of US broiler exports in the form of leg quarters.


With prices having recovered from their lows last year, producers can expect to be profitable despite higher feed prices, the report said.


The increase in leg quarter prices and stable red meat exports would prevent price increases with chicken breast prices.


However, boneless skinless breast prices still rebounded strongly from record lows of US$1.13 in 2006, and will likely average above US$1.50 in 2007, the report said.

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