August 19, 2011


US broiler meat production scales 4.5%



US broiler meat production yielded 3.3 billion lbs in June, up 4.5% from the previous year, according to the Wednesday (Aug 17) Livestock, Dairy and Poultry Outlook from the USDA's Economic Research Service.


The June production increase pushed total production for second-quarter 2011 to 9.5 billion lbs., 3.3 % higher than in second-quarter 2010.


This marks the fourth consecutive quarter of 3% or greater on-year increases in broiler meat production. Broiler meat production in first-half 2011 totalled 18.8 billion lbs., 5% higher than a year earlier. This year-over-year growth in broiler meat production is expected to stop in third-quarter 2011, with production estimated at nine billion lbs., 1% lower than in third-quarter 2010. Lower production is expected to continue in the fourth quarter, with production in the second half of 2011 expected to total 19 billion lbs., a decrease of 2% from the same period in 2010.


During the first half of 2011, the number of broilers slaughtered was four billion, up 2% from one year earlier. The other factor in broiler meat production growth during the first half of 2011 has been higher average live weights at slaughter. During the first six months of 2011, the average live weight at slaughter was six lbs., up 2% from first-half 2010.


In second-half 2011, the number of broilers slaughtered is expected to be down significantly from the previous year, but average bird weights at slaughter are expected to remain well above the previous year throughout the second half of 2011.


Cold storage holdings at the end of the second quarter totalled 710 million lbs., 12% higher than one year earlier. Breast meat in cold storage was estimated at 155 million lbs., 47% higher than the previous year.


Stock changes for leg meat products were mixed, with holdings of drumsticks and leg quarters up 39 and 14%. Partially offsetting these increases were declines in the cold storage holdings for legs, thighs and thigh meat.


Estimates for ending stocks for the third and fourth quarters of 2011 were increased. The estimate for third-quarter 2011 was raised to 685 million lbs. and the estimate for fourth-quarter 2011 was increased to 700 million lbs.


In 2011, wholesale prices for broiler products have generally declined compared with a year earlier. Prices for whole birds averaged 82.6 cents per lb. in the second quarter of 2011 and are forecast to average 81 to 83 cents per lb. in the third quarter. Even with falling production in the second half of 2011, whole bird prices are not expected to strengthen much.


The fourth-quarter 2011 forecast is only 81 to 85 cents per lb. In 2012 as lower production begins to impact stock levels, broiler prices are expected to experience some upward price pressure. However, any upward pressure will likely also depend on a gradual strengthening of economic conditions.

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