Chicken Hatchery Output Declines

Despite forecasts for annual growth, chicken egg sets in hatcheries generally ran below a year earlier in March and April.

USDA-National Agricultural Statistics Service data for the week ended May 14, the latest week available, showed a 1.758-million, or 0.83%, year-over-year decline in broiler eggs set to 210.074 million from 211.832 million.  Declines compared to 2015’s have been registered for five of the last six weeks.

As of April 1, broiler-type layers in hatcheries were unchanged from a year earlier.

Compared with the 2010-2014 average, however, broiler egg sets continue to show growth.  For the latest week, sets were 3.779 million, or 1.832%, above the $206.295-million average.

Placements of pullets for broiler layer replacement during the 7-15 months prior to April 1 were about 7% above a year ago, and the same count for May 1 showed an 8% increase, the LMIC said.

 

TRYING TO RESTRAIN PRODUCTION

 

There is a rather large difference between the actual broiler-type hatchery flock and prior pullet placements, which reflects chicken industry efforts to restrain production in the face of disappointing product demand, especially exports, the LMIC said.

Hatchings relative to pullet placements 7 to 15 months earlier have been running below average since last September.  This corresponds to price trends for breast meat and leg quarters that began declining in late 2014.  This rate has generally accelerated so far in 2015.

The reasons for slipping product prices can be tied to chicken export volumes that began to decline, on a year-over-year basis, in the last quarter of 2014 and to pork prices that were under pressure beginning in early 2015.

Lower trending beef prices since late 2015 have amplified the problems for chicken product demand, LMIC said.

Hatchery flock productivity ran slightly below normal from September through February.  February’s productivity was skewed by an additional day of productivity for Leap Year.

Productivity during March was noticeably lower than prior months, but not to an unprecedented degree, based on measures over the 2008-2015 timeframe.  Preliminary data for April implies hatchery productivity below the lowest level April output, registered in 2009.

And, based on trends during the first half of May, the productivity deviation will be even bigger than April, the LMIC said.

 

CASH CATTLE MARKET QUIET

 

Cash cattle markets Monday were quiet with no bids or offers reported.  Feedlot showlists were thought to be larger than last week in all major feeding states.

Cash cattle markets last week were steady on a live basis and up $2 to $3 on a dressed basis at $128 per cwt live and $208 to $210 dressed.  Volume was thought to be light to moderate.

The USDA’s choice cutout Tuesday was $0.11 per cwt lower at $227.56 per cwt, while select was off $2.31 at $204.30.  The choice/select spread widened to $25.57 from $23.37 with 114 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Friday was $148.75 per cwt, down $0.16.  This compares with the Aug settlement Monday of $141.05, down $4.50.