May broiler production was 3.7 billion pounds, 2.3 percent higher than a year ago. Average live weights were up 1.1 percent from last year, accounting for nearly half of production growth.

The number of chicks placed in meat-growing operations has trended strong since May, supported by a breeder inventory of over 59 million as of June 1. Strong placement levels during June also reflect improving performance of placements as a portion of eggs set in incubators 3 weeks prior, an indicator of fertile-egg hatchability. The production projection for 2018 was increased 45 million pounds for the second and third quarters, bringing the annual total to 42.495 billion pounds. Projected production for 2019 was increased 60 million pounds, according to USDA July Livestock, Dairy, and Poultry Outlook.

Broiler exports totaled 548 million pounds in May, down 4 percent from May 2017. Shipments to Mexico, the United States’ largest broiler export market, decreased year over year by 3 percent. This decline was likely due to a brief halt in shipments caused by an outbreak of Newcastle disease in California. Nonetheless, shipments to Mexico resumed, and it is anticipated that Mexican tariffs on U.S. pork could make broiler meat—on which Mexican tariffs have not been levied — more attractive, increasing demand. This expected rebound, coupled with increasing shipments to other major foreign markets (i.e., Taiwan, Angola, Cuba, Canada, Guatemala, and Vietnam), contributes to 2018 forecasts remaining unchanged.

With regard to imports — a minor component of broiler supply — May broiler imports were 10.8 million pounds, down 9 percent from a year earlier. Imports declined year over year from both Chile (-15 percent) and Canada (-5 percent), the United States’ two major suppliers. Based on sluggish second-quarter imports and strong domestic production expectations, broiler imports were revised downward by 4 million pounds to 127 million pounds for 2018 and by 7 million pounds to 129 million pounds for 2019.

Weekly whole broiler (national composite) prices continued to climb well into June, reaching a 2018 peak of 121 cents per pound for the week ending June 8 and nearly surpassing the 2014 historic high of 121.09 cents per pound. Prices have since begun steadily decreasing in line with seasonal trends. In recent years, prices have typically peaked in May or early June, so the additional 1 to 2 weeks of climbing prices, combined with higher-than-expected second-quarter prices, were the basis for increasing the third- and fourth-quarter price forecasts to 103-107 cents per pound and 94-100 cents per pound, respectively.


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