Turkey
Turkey meat production is expected to increase in 2012 to 5.8 billion pounds, up about 2 percent from the previous year. The increase is expected to be a combination of both an increase in the number of birds slaughtered and higher average live weights of these birds at slaughter. Turkey meat production is expected to show some increase throughout the year.
With higher prices throughout 2010 and also expected in 2011, turkey producers should have considerable incentive to increase production in 2012 as long as the general economic indicators remain positive.
In first-quarter 2011, turkey meat production was 1.4 billion pounds, up 4.7 percent from the first quarter of 2010. After being below a year earlier for 7 consecutive quarters between first-quarter 2009 and third-quarter 2010, turkey production has now risen for two quarters in a row on a year-over-year basis. The production increase was the result of more birds slaughtered (up 3.6 percent) and higher average weights at slaughter (up 1.1 percent). Higher turkey prices throughout 2010 provided turkey producers an incentive to increase production. The production estimates for the third and fourth quarters of 2011 were both increased by 25 million pounds. Even with the increase, fourth-quarter 2011 production is expected to be down somewhat from the previous year.
Turkey Stocks Lower
Even with higher production in fourth-quarter 2010 and first-quarter 2011, turkey stocks at the end of first-quarter 2011 were still considerably lower than the previous year, down 13 percent to 331 million pounds. This decline was a combination of lower stocks of both whole birds, down 9 percent, and turkey parts and products, down 15 percent. Stocks of whole birds and parts have now been below previous-year quantities for 19 consecutive months. Stocks in 2011 are expected to remain lower than the previous year through the end of the second quarter, but gains in production are expected to move stock levels higher in the second half of 2011. Higher prices for whole birds and turkey parts are expected to reduce demand in the export market and ending stocks in 2012 are expected to be somewhat higher, although domestic demand is expected to remain strong due to higher prices for most red meat products.
Wholesale prices for whole hen turkeys are expected to average $0.97 and $1.01 per pound for 2011, up about 10 percent from a year earlier. With low beginning stocks and only a small increase in production expected in 2011, whole bird prices are expected to remain above the previous year throughout 2011, although the gap on a year-over-year basis is expected to narrow considerably as the year progresses. In 2012, any upward pressure on prices from an improving domestic economy and higher export demand is expected to be offset by higher production and increasing stock levels in the second half of the year.
After increasing strongly in 2011, turkey exports in 2012 are forecast to total 600 million pounds in 2012, down 2 percent from the previous year. The export reduction is expected to be due to continued strength in turkey prices, brought on by relatively low stock levels. The strength of the Mexican economy and relative prices between beef and pork and lower-priced alternatives will be a major determinant of turkey exports in 2012.
In first-quarter 2011, turkey exports were 160 million pounds, up 41 percent from a year earlier. The majority of the increase came from a 42-percent increase in shipments to Mexico, from 24 million pounds in 2010 to 32 million pounds in 2011. Shipments of turkey products also rose sharply to China and Hong Kong.