USDA this week released its August Livestock, Dairy, and Poultry Outlook report.
2020 broiler production forecast was unchanged and the 2021 forecast was increased on lower feed costs. The broiler export forecast was decreased based on continued weakness in key export markets, as well as on potentially slowing demand from China. The broiler price forecast was increased slightly based on recent price movements and expectations for near-term demand.
For the second consecutive month, June average live bird weights set a new record, reaching 6.48 pounds or 2.5-percent higher than last year. These heavier bird weights can largely be attributed to backups at processing facilities, which caused birds to remain in flocks longer and thus to gain weight.
Preliminary weekly slaughter data indicates that the heavier weights began manifesting in early May and continued until the end of June. Despite the record weights, June production, estimated at 3.8 billion pounds, decreased by 2.8-percent year over year on a daily basis, driven by a 5.2-percent decrease in per day slaughter.
In July, preliminary data points toward declining weights, with average weights tracking slightly below last year, suggesting that processors have largely worked through the backlog of birds. July slaughter is expected to be down year over year. After adjusting for the June production estimate, the 2020 production forecast is unchanged.
In 2021, lower feed prices are expected to motivate increased production, which was the basis for raising the production forecast to 45.275 billion pounds, an increase of 1-percent relative to the 2020 production forecast.
The table egg production forecast was increased based on higher-than-expected lay rates, while the price forecast was decreased on recent prices and high shell egg inventory levels. The egg export forecast was revised up on egg-product demand.
