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US poultry industry in contraction phase

Higher feed costs, an over-supply of broiler meat as well as economic slowdowns in the domestic and foreign markets have pressured poultry prices leaving the US poultry industry struggling to maintain profitability.

This was recently reported by the Livestock Marketing Information Center.

The broiler industry has initiated cutbacks in the hatchery flock and beginning to mitigate recent large year-to-year gains in bird weights. These actions have been evident in the weekly eggs set and chicks placed data since late summer, as well as recent broiler slaughter numbers.

Since late April, the number weekly eggs set by producers have been consistently below a year ago with the largest year-to-year declines posted in the 4th quarter. During October and November egg sets were down 8% and more than 3% lower than the 2002-2006 average. Meanwhile, the number of chicks placed is down more than 7% thus far this quarter with further below year ago numbers expected given recent declines in egg sets.
US broiler production for October was below a year ago due to a smaller number of birds, as the number of slaughter days was equal to 2007.

According to a USDA-NASS report, in October US broiler production (ready-to-cook basis) was down 3% from 2007, but remained about 8% over the 2001-2006 average. Based on preliminary weekly data, US broiler production for November should be 5-6% lower than 2007. That trend will continue in December and then well into 2009.

Source: Livestock Marketing Information Center

Natalie Berkhout

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