September 20, 2011


USDA raises estimate for Q3 broiler production



The US broiler meat production estimate was raised by 25 million to 9.4 billion pounds in the third quarter, says the USDA's Economic Research Service.


Although the number of chicks being placed for growout is down significantly from a year earlier, average live bird weights at slaughter have continued to be much higher than on-year, almost completely negating the downturn in the number of broilers going to slaughter. The broiler meat production estimate for the fourth quarter was lowered to 9.2 billion pounds, down 25 million pounds from the previous estimate.


The reduction in fourth-quarter production is largely due to the impact of continued lower chick placement. However, in third-quarter 2011, live bird weight at slaughter is expected to be much closer to that of the previous year. The new production estimate for 2012 is 37.5 billion pounds, only a slight increase from the previous year. This downward revision in the 2012 production estimate was due to expected continued high grain prices, along with only minor improvements in the domestic economy.


Broiler meat production in July totalled 3.0 billion pounds, down 1.5% from one year earlier. This decline in production can be attributed chiefly to the fact that July had one fewer slaughter day than the previous year. The number of birds slaughtered in July was down 4.7% to 696 million. Most of the decrease in the number of birds slaughtered was offset by a 3% gain in average liveweight, to 5.76 pounds. During August and September, the number of chicks placed for growout is expected to remain well below the level of the previous year, while higher average weights are also expected to continue.


For the five-week period ending September 10, the National Agricultural Statistics Service estimated that an average of 162 million broiler chicks were placed weekly for growout. This is a 5% decrease from the similar period in 2010. Since mid-June, the on-year decline in the number of chicks placed has grown from only slightly lower to sharply lower. This pattern of strong decline in chick placements for growout is expected to continue through the remainder of the third quarter and into the fourth.


After remaining stagnant in June, the quantity of broiler products in cold storage at the end of July rose by just under 10 million pounds to 726 million pounds, 14% higher than the previous year. Although the stock levels rose for a number of the reported categories, most of the increase was in the basket category of unidentified products, which saw an increase of 22 to 301 million pounds, or 41% of all broiler holdings in cold storage.


With slower growth in production in the third quarter, stock levels are expected to decline to 685 million by the end of the third quarter and are expected to be 700 million pounds by yearend.

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