Egg settings and chicks placed over the past five weeks point toward little or no gains in the number of broilers available for slaughter in the “near future” and the likelihood that any gains in broiler meat production will come from increases in average bird weights, according to the “Livestock, Dairy, and Poultry Outlook” report from USDA’s Economic Research Service (ERS) this week.
The incentive for broiler companies to expand production in 2014 is expected to result mainly from two factors, the report noted. The first is an expected decline in feed costs from 2012-13, about 30 percent for corn to between $4.30 – $5.10 per bushel in 2013-14 and about 30 percent for soybean meal prices to an average of $280 – $320 per ton. The second factor is expected gains in real per capita disposable income and a gradual lowering of the unemployment rate.
Broiler production during first quarter 2013 increased 0.6 percent over year earlier with one less processing day during January-March this year. The average liveweight for broiler during the first quarter was 5.9 pounds, 1.3 percent heavier than in 2012. Broiler production during second quarter 2013 is expected to be up 1.3 percent from year ago. Broiler production on a year-over-year basis is expected to expand faster in the third and fourth quarters of 2013 as feed costs begin to decline, ERS said. ERS noted that the gain in average live weights is a long-term trend, with year-over-year average weights increasing consecutively from 1975 through 2012.
ERS reports that volatility characterizes recent price movements for cattle and beef as drought continues in the Southwestern United States and cool weather dampens enthusiasm for outdoor grilling. As a result of the drought, cow slaughter is above year-earlier levels, and slaughter cow prices have declined as pastures deteriorate and hay and feed prices increase. However, stronger wholesale cutout values for beef and fed cattle prices are encouraging signs, ERS said.
ERS said pork producers are expected to take advantage of lower feed costs to modestly increase pork production next year. Commercial pork production in 2014 is expected to increase 2.3 percent. As in previous years, production increases will likely derive from a series of modest increases along the production sequence, with farrowings expected to be up modestly (almost 1 percent, year-over-year, compared with 2013), continued moderate increases in litter rates (about 1 percent above 2013), and higher average dressed weights (about 1 percent higher than 2013), which together are expected to set another pork production record in 2014, the report concluded.
