During the past two weeks, the U.S. poultry industry lost 188,000 turkeys and breeders in seven outbreaks in three states.  The egg segment lost a total of 1.7 million hens in two outbreaks in California and Iowa.  Since the onset of fall 2023, USDA has depopulated close to six million egg production hens together with at-risk pullets, 1.5 million broilers and breeders, 2.7 million turkeys and breeders and 600,000 other commercial species.  This dismal record presumes a repeat of 2022 that was devastating to turkey and layer producers, the public sector and above all, for consumers. 

From informal and anonymous conversations with middle-level APHIS professionals, it is apparent that senior administrators are committed to a perpetual cycle of diagnosis, depopulation and surveillance over the long-term.  If we knew more about how infection is actually introduced onto farms, we would be in a better position to protect flocks.  The delayed and incomplete epidemiologic studies on 2022 cases with reports delayed by a year have not helped in identifying factors leading to outbreaks on farms and complexes. In the absence of an understanding of how avian influenza virus travels from the cloacas of migratory waterfowl to the nares of  confined hens we are unable to implement definitive action to reduce the incidence rate.  It is self-evident and confirmed by preliminary studies that proximity of migratory waterfowl and possibly infected domestic birds to farms represents a risk factor. This is supported by surveys confirming shedding of H5N1 avian influenza virus.  It is also evident that specific counties in Minnesota, Iowa, Colorado, Wisconsin, North Dakota and South Dakota among others are vulnerable to both infection and reinfection due to their proximity to wetlands and expanses of water that attract migratory waterfowl.

Admittedly, conceptual biosecurity is compromised by locating vulnerable poultry flocks in flyways that place them in contact with shedders of virus. There are evidently deficiencies in both structural and operational biosecurity over and above the basic flaw of location represented by conceptual biosecurity. The USDA continually promotes generic biosecurity in general terms without identifying specific deficiencies in any of the installations or procedures that have contributed to infection of commercial flocks.  Factors including feed supplied from common mills, especially in the turkey segment and obvious deviations from high levels of operational biosecurity have probably contributed to outbreaks.  In specific cases during 2022, some large egg production complexes were inexplicably impacted. These farms were known to exercise extreme levels of biosecurity and with anecdotal evidence of airborne transmission of virus. This route of infection may have extended for distances of up to a mile but most likely was measured in hundreds of yards between the perimeters of farms and adjacent waste lagoons or wetlands colonized by migratory birds.

EGG-NEWS has consistently and repeatedly urged APHIS to mount an intensive epidemiologic evaluation of risk factors contributing to outbreaks.  Surely experience in 2015 should have predicated preemptive planning for investigations in anticipation of a likely series of future outbreaks. These occurred in 2022 with continuation through the present year and with the prospect of seasonal continuation through 2024.  What is needed is to immediate deploy a team of trained personnel to investigate outbreaks as they occur.  Epidemiologists conversant with practices used in both the egg and turkey industries should be sent to selected farms immediately a diagnosis is confirmed.  Appropriate questionnaires should be developed that relate specifically to turkey and egg production units respectively.  Recollection by managers and possible recognition of factors contributing to infection would be obtained reliably in real time.  Attempting to identify risk factors months after an event using a generic 20-page questionnaire administered by telephone is an exercise in futility.   

Evaluation of airborne transmission of H5N1 virus should be undertaken over the 2-to-5-day period required to depopulate a one million-hen or larger egg production complex.  We need to know the level of airborne virus in the vicinity of concentrations of waterfowl that are congregating in high-risk counties in the states that have been seriously impacted.  We need to know the duration of persistence of infectivity of virus excreted by waterfowl.  We need to understand the effect of weather conditions including temperature, humidity, wind velocity and direction in relation to outbreaks.  We need to establish factors contributing to vulnerability including the apparent high incidence rate among in-line or hybrid breaking operations.

APHIS can draw on hundreds of millions of dollars for depopulation, indemnity and cleanup.  Surely, money should be made available to investigate why and how farms are infected with avian influenza?  Colleagues in APHIS have both the desire and the ability to conduct structured epidemiologic investigations as a Departmental initiative especially in collaboration with specialists at Land Grant Universities in the states that are most affected.  To date, many field veterinarians are functioning with minimal incentive and negligible support from their superiors.  Allocation of funds to study why and how farms are infected in both the turkey and egg production sectors of the industry will be critical to developing future strategy for prevention.

There is a growing sentiment both within APHIS and the industry that if in fact avian influenza virus is introduced onto farms by the airborne route, then even the most intensive and efficient biosecurity will not be protective.  Are we emulating the Aztecs by figuratively throwing virgins into a volcano to ensure its quiescence by analogy adhering slavishly to isolated aspects of biosecurity but ignoring the most important mechanism of infection? APHIS administrators are both intelligent and educated and must have considered airborne transmission as has been proven for Newcastle disease.  Paramyxoviruses and orthomyxoviruses are not that different in their ability to survive in the environment and should have similar routes of transmission.

As noted in weekly postings, EGG-NEWS urges APHIS administrators to allocate resources to conduct epidemiologic investigations to be conducted in real time, with rapid analysis in order to provide the industry with practical and applicable procedures to protect flocks.

Unfortunately, if it is demonstrated that airborne transmission is a reality, and that even extreme biosecurity fails to provide absolute protection then additional protective modalities will be required. Regional, seasonal and segment-specific immunization emerges as a rational and potentially effective method of prevention. Vaccination as an adjunct to existing measures to protect flocks must lose its taint of heresy and undergo dispassionate scientific and economic evaluation based on sound epidemiologic investigations.

EGG-NEWS summarizes and comments on data and trends in the monthly USDA Cage-Free Report. This data is correlated and interpreted in the WeeklyEggPrice and Inventory Report posted on EGG-NEWS mailed on Fridays each week.

The USDA Cage-Free Report covering November 2023, released on December 1^st 2023, confirmed the complement of hens producing under the Certified Organic Program to be 18.9 million (rounded to 0.1 million), unchanged from October. The number of hens classified as cage-free (but excluding Certified Organic) and comprising aviary, barn and other systems of housing declined 1.1 percent from October 2023 to 106.3 million due in part to depopulation following HPAI. Hen numbers posted by the USDA over successive months or quarters are questioned if they demonstrate erratic fluctuation or are unchanged. This is based on the reality of a continuing cycle of placing pullets and depletion of old hens and with limited application of molting. The respective numbers of hens claimed for organic and cage-free flocks should reflect chick placements and correspond to monthly supply data and inventory over successive quarters.

Average weekly egg production for Certified Organic in November 2023 was up 0.2 percent compared to October 2023 with a hen-month average production of 83.5 percent. Average weekly flock production for cage free flocks other than Certified Organic was down in October 2023 by 0.8 percent with an average hen month production of 82.4 percent. Seasonally, younger flocks increase the availability of cage-free and organic eggs in response to pullet chick placements laid down 22 weeks previously in anticipation of peak seasonal demand periods. November data reflected a higher proportion of younger flocks derived from pullet chicks placed during May 2023.

Negotiated nest-run gradeable cage-free price for November 2023 averaged $1.95 per dozen up by 58.5 percent from $1.23 per dozen in October 2023, reflecting higher demand relative to supply and an improvement over seasonal wholesale prices. The November 2023 advertised U.S. retail price for cage-free eggs over six regions (excluding AK and HI) was $2.58 per dozen down 21.8 percent from October over 5,704 stores.

The apparent difference between a recorded average wholesale price of $1.95 per dozen plus a provision of 60 cents per dozen for packaging, packing and transport in relation to the average six-region retail price of $2.58 indicates a retail margin of 1.2 percent (80.3 percent last month) over wholesale price for packed eggs delivered to a DC. Margins are presumed higher for pastured and other specialty eggs at shelf prices reaching $8.00 per dozen. Chains that are maximizing margins especially on Certified Organic, free-range and pastured categories restrict volume of sales, ultimately disadvantageous to producers.

Based on the importance of cage-free production, the USDA-AMS issue the Cage-Free report on volumes and prices at monthly intervals for the information of Industry stakeholders. There is obvious doubt as to the accuracy of individual monthly flock numbers especially when reports show a marked change at the end of a quarter or from the previous month, or alternatively no change in the cage-free flock for sequential months. It is suggested that USDA should consider a quarterly report with more accurate and consistent hen data. This would be more useful to the industry for planning and marketing decisions. Price data is available each week from other USDA reports.

Subscribers are referred to weekly USDA wholesale and retail prices posted in the Egg Price and Inventory Report in EGG-NEWS E-mailed each Friday. The previous Monthly Cage-Free Report is available under the STATISTICS Tab.

USDA Weekly Egg Price and Inventory Report, December 6^th 2023.

Market Overview

• The average wholesale unit revenue values for Midwest Extra-large and Large sizes were down 14.4 percent on average this past week, an unusual trend for the season. Mediums were down by 14.4 percent. Prices are now equivalent to the 3-year average for early December values but should have demonstrated a sustained weekly upward trajectory. This past week shell egg inventory was up by a substantial 8.4 percent, following a rise of 9.6 percent the previous week. The increase in inventory is both a function of lower demand and a deliberate reluctance of chains to re-stock after the Thanksgiving period in anticipation of a decline in benchmark price. Supply is increasing due to small but progressive weekly increases in the national flock from July onwards and continuing through November, but offset by the loss of 5.2 million hens on five complexes due to HPAI over six weeks. This past week, chains narrowed the spread between delivered cost and shelf price. This should result in a progressively lower level of generic stock coupled with increasing demand and re-ordering to fill the pipeline. Deep discounters are holding prices on generics at a low level influencing mainstream retail stores. Eggs are still highly competitive in price against the comparable costs for other protein foods.
• Total industry inventory was up by 7.0 percent overall this past week to 1.94 million cases with a concurrent 1.0 percent increase in breaking stock, following a 13 percent increase during the preceding short processing week. Demand for egg products will presumably increase as fall transitions to winter with more home baking and entertaining. Egg products are required for the food service and manufacturing sectors although exports are at a low level. Wholesale shell-egg prices compare with 2020 and 2021, also characterized by low ex-plant unit revenue. Benchmark prices were approximately $1.70 per dozen lower than the exceptional prices during the corresponding week in 2022, influenced by flock depletions due to HPAI coupled with extreme demand.
• It is now apparent that the inventory held by chains and other significant distributors may be more important over the short term in establishing wholesale price than the USDA regional inventory figures. Changes in stock held by DCs and in the pipeline as determined by weekly orders are probably responsible for cyclic fluctuation in weekly industry stock.
• Unit revenue should increase progressively through December with seasonal baking. Outbreaks of HPAI are now underway with five complexes with an average of 1.0 million hens each, depleted over the past six weeks. Cases in the turkey industry and backyard (non-commercial WOAH flocks) continue, coincident with the seasonal Fall migration of waterfowl. The number and extent of future possible outbreaks during late fall and the early winter of 2023 cannot be assessed until more information is available concerning the prevalence of carriers among migratory birds and a review of molecular and field epidemiology for the 2022 spring and fall waves of HPAI. The USDA has yet to identify specific modes of transmission for the 2022 epornitic including possible airborne spread from wild birds and their excreta over short distances.
• The current relationship between producers and chain buyers based on a single commercial price discovery system constitutes an impediment to a free market. The benchmark price appears to amplify both downward and upward swings as evidenced over the past two years. A CME quotation based on Midwest Large, reflecting demand relative to supply would be more equitable. If feed cost is determined by CME ingredient prices then generic shell eggs should be subject to a Midwest Large quotation.
• According to the USDA the U.S. flock in production was unchanged at 316.9 million during the week ending December 6^th. The total flock of 324.4 million included about 3.0 million molted hens that will resume lay during coming weeks plus 4.0 million pullets attaining production. Given the latest figures it is estimated that the producing flock is now two million hens lower than before the onset of HPAI in 2022.
• The ex-farm price for breaking stock was unchanged this past week at $1.12 per dozen.Checks delivered to Midwest plants were unchanged at $1.01 per dozen. Prices for breaking stock will follow the wholesale price for shell eggs.

The Week in Review

Prices

According to the USDA Egg Market News Reports released on December 4^th the Midwest wholesale price (rounded to one cent) for Extra-large was down an unseasonal 13.8 percent from last week to $1.99 per dozen. Large was down 13.8 percent to $1.97 cents per dozen. Mediums were down 14.4 percent to $1.90 per dozen delivered to DCs. Prices should be compared to the USDA benchmark average 6-Region blended nest-run cost of 81.5 cents per dozen as determined by the USDA for November 2023. This excludes provisions for packing, packaging materials and transport, amounting to 57 cents per dozen as determined in mid-2023 from an EIC survey (with low response) and now possibly 60 cents per dozen. Currently producers of generic shell eggs should be operating with positive margins irrespective of region and customer-supply agreements. The progression of prices during 2023 to date is depicted in the USDA chart reflecting three years of data, updated weekly.

The December 4^th 2023 edition of the USDA Egg Market News Report confirmed that the USDA Combined Region value (rounded to the nearest cent), was up 1.3 percent to $2.38 per dozen delivered to warehouses for the week ending November 29^th 2023. This average price lags current benchmark Midwest weekly values by one week. The USDA Combined range for Large in the Midwest was $2.29 per dozen. At the high end of the range, the price in the South Central region attained $2.45 per dozen. The USDA Combined Price last week was approximately 10 cents per dozen above the 3-year average of $2.25 per dozen. This past week Midwest Large was approximately $1.70 per dozen below the corresponding week in 2022 at $4.50 per dozen.

Flock Size 

According to the USDA the number of producing hens reflecting December 6^th (rounded to 0.1 million) was unchanged from last week at 316.9 million. The total U.S. flock includes about 3.0 million molted hens due to return to production with approximately 4 million new pullets reaching maturity each week based on USDA monthly chick-hatch data for 20-weeks previously. The increase is offset by routine flock depletion in addition to residual losses during the Fall phase of the 2022 HPAI epornitic and an additional loss of 5.2 million over the past six weeks. (The case involving 1.6 million hens in Iowa was included in the latest USDA data). Based on inventory level and prices, the population of hens producing table eggs and breaking stock should now be slightly higher than seasonal consumer demand. Industrial and food service off-take although increasing, is approaching pre-COVID levels. Prices will continue to fluctuate but have commenced a seasonal rise in price that will extend into December with the trend accentuated by possible additional incident cases of HPAI.

According to the USDA the total U.S. egg-flock on December 6^th was up 0.4 million hens (0.1 percent) to 324.4 million including second-cycle birds and those in molt. The difference of 7.5 million hens between flocks in production and total hens is an approximate figure but denotes that molted hens have resumed production in anticipation of December demand. Given the season and the trajectory of benchmark wholesale prices only a few older flocks will be molted or depleted until January 2024. At present there are two million fewer hens in the total flock with the difference equivalent to about 0.7 percent of the pre-HPAI national flock of 326 million hens.

INVENTORY LEVELS

Cold storage stock of frozen products in selected centers on December 4^th 2023 was 2.314 million pounds (1,052 metric tons), unchanged for three weeks (?) and down 3.3 percent from the inventory of 2.393 million lbs. on November 1^st 2023. The monthly USDA Cold Storage Report below quantified an increase in the actual total stock level at the end of September.

The most recent monthly USDA Cold Storage Report released on November 22^nd 2023 documented a total stock of 31.2 million pounds (14,165 metric tons) of frozen egg products on October 31^st 2023. This quantity was up 28.8 percent from the October 31^st 2022 value of 24.2 million pounds. October 1^st 2023 frozen egg inventory was up 3.3 percent from the previous month ending September 30^th 2023 attributed to presumably lower domestic or export demand or their combination. Compared to October 31^st 2022 inventory of whites was down 10.6 percent to 2,688 million lbs. on October 31^st 2023. Compared to October 31^st 2022 yolk inventory was up 163 percent to 1,287 million lbs. on October 31^st 2023.

A total of 87.2 percent (27.2 million lbs.) of combined inventory comprised the categories of “Whole and Mixed” (40.3 percent) and “Unclassified” (46.9 percent). The lack of specificity in classification requires a more diligent approach to enumerating and reporting inventory by the USDA.

Shell Inventory

The USDA reported that the national stock of generic shell eggs effective December 4^th 2023 was up 8.4 percent over the previous week. Inventory over the past week followed a rise of 10.2 percent the previous week indicating an unexpected decline in seasonal consumer demand. Replenishing stock in DCs and stores after Thanksgiving appears to have been delayed. Combined with breaking stock, the total inventory of shell eggs in industry cold rooms is now at a rounded level of 1.94 million cases (1.81 million last week; 127,200 cases higher this week). The U.S. population of laying hens at this time is influenced by:-

• The small number of older birds previously culled during the fall phase of the 2022 HPAI epornitic now approaching the end of their first cycle
• Incident outbreaks of HPAI with the loss of close to 6.0 million hens in six weeks
• The population unaffected by HPAI,
• Flocks retained after molting (with an anticipated decrease in this category based on prevailing egg prices)
• Started pullets from chick placements during early June 2023. Going forward, younger hens will assume a larger proportion of the national flock as more flocks are placed compensating for the flocks depleted due to HPAI.

Five of six USDA Regions reported higher stock levels this past week. The regions are listed in descending order of stock: -

• The Midwest Region was up 12.4 percent from the previous week to 509,800 cases.
• The South Central Region was up 4.8 percent to 314,100 cases
• The Southeast Region was up 10.3 percent to 306,800 cases
• The Northeast Region was up 17.1 percent to 212,100 cases
• The Southwest Region was down 5.0 percent to 156,300 cases.
• The Northwest Region was up 2.1 percent to 93,100 cases

The total USDA six-area stock of commodity eggs comprised 1,941,200 cases (1,814,000 cases last week), up 7.0 percent, of which 82.0 percent were shell eggs (81.0 percent last week). The inventory of breaking stock was up 1.0 percent to 348,900 cases. Shell egg inventory was up a substantial 8.4 percent attaining 1,592,300 cases. These increases are a function of transitory decline in demand coupled with delays in re-stocking after the Thanksgiving period. Outbreaks of HPAI will probably influence buyers who should be concerned over short-term availability in the event of possible depopulation of additional flocks moving into the Christmas period. Retailers are hopefully restocking in anticipation of demand and are constraining margins.

The slightly higher level of breaking stock over the past week is consistent with falling demand. Subsequent weekly stock levels of shell eggs will indicate the extent of industrial and consumer offtake. Breaking is stimulated by conversion to egg powder and liquids for export and with seasonally higher demand for liquids by industry and food service. The average price for Midwest checks and breaking stock combined was 54.5 percent of the average value of Midwest Extra-large and Large shell eggs (46.9 percent for previous week) consistent with proportionately lower prices for breaking stock and checks compared to shell eggs. The differential can be compared to 80.0 percent in April 2022 reflecting the initial period of high demand for both shell eggs and products. This past week the wholesale prices for Midwest Extra-large and Large shell eggs were down 13.8 percent on average compared to the combination of breaking stock and checks that were unchanged from the previous week. This demonstrates the respective demands for shell eggs and egg products and the interconnectivity of the packing and breaking segments of the egg industry under circumstances of extreme disturbances in either supply (lower due to HPAI in 2022) or demand (higher during COVID in 2020). The price for breaking stock and for checks is influenced by the relative demand for generic shell eggs and contract obligations with breakers.

On December 4^th 2023 the inventory of other than generic eggs amounting to 467,700 cases (up 3.0 percent from last week to 454,000 cases) among three categories (with the previous week in parentheses) comprised: -

• Specialty category, up 6.0 percent 36,100 cases. (Was down 5.8% to 34,000 cases)
• Certified Organic, down 5.9 percent to 94,300 cases. (Was up 4.8% to 100,200 cases)
• Cage-Free category, up 5.5 percent to 337,300 cases. (Was up 1.1% to 319,800 cases)

Demand for cage-free product will not increase materially over the intermediate term while generic eggs from caged flocks and some surplus down-classified cage-free eggs are on the shelf at $1.80 to $2.10 per dozen during normal supply and demand conditions. Currently there is a wide differential in shelf price between generics compared to the considerably higher priced omega-3 enriched, cage-free, free-range and pasture-housed products. That the higher priced egg categories will experience an erosion in demand as generic prices fall is supported by the findings of a comprehensive review relating to the transition from cages to alternative systems.*

Existing and proposed individual state legislation mandating sale of only cage-free eggs will support most of the completed and anticipated transition from cages but total re-housing will not be completed by the beginning of 2025, less than 12 months away and ultimately never, as projected by most industry observers. The constitutional status of Proposition #12 was confirmed by SCOTUS in a May 11^th 2023 decision with specific reference to the dormant Commerce Clause relating to interstate trade. It is unlikely that a legislative initiative (the EATS Act) will be incorporated into the 2023 Farm Bill (that will be delayed at least into February 2024), to limit the impact of Proposition #12 on sows housed for pork production. Many retail chains are ‘renEGGing’ on or extendingnd their time commitments to achieve an acceptable transition to cage-free eggs despite coercion by animal welfare groups. With the current proportion of non-caged flocks and lower prices for generic cage-derived eggs, cage-free eggs are surplus to demand in some areas. Cage-free eggs are becoming a commodity in many markets subjected to the same price pressures as generic eggs from caged hens. Demand for organic product increased this past week responding to lower shelf prices and a narrower spread from cage-free product, compensating for the recent build in stock. Inventory of this category is holding just below 100,000 cases although this quantity represents the approximate production of three days of lay. Long-term demand for cage-free eggs will be influenced by the relative shelf prices of the category in comparison with generic white-shelled eggs from caged flocks. Inventory of this category remains above the 300,000-case benchmark, but effectively is working stock given weekly production of 1.7 million cases per week. At the other end of the price range, consumers will purchase less-expensive brown cage-free product over organic eggs when there is a differential in price greater than about $1.20 per dozen under normal conditions of supply and demand. Similarly, consumers will traditionally purchase white-shelled generic eggs in preference to white or brown-shelled cage-free with a differential of over $1.20 per dozen.

*Caputo,V. et al The Transition to Cage-Free Eggs. February 2023

A comprehensive structured market research project on cage-free eggs has provided an indication of consumer willingness to pay for this attribute. The industry requires a study on other aspects including shell color, GM status and nutritional enrichment. Above all, agricultural economists should evaluate the impact of disruption in supply and demand arising from large-scale depopulation following HPAI in 2015 and for the 2022 HPAI epornitic extending through partial restoration of hen numbers but a disproportionate decline in wholesale price during the first quarter of 2023.

RELATIVE PRICES OF SHELL-EGG CATEGORIES

USDA-AMS posted the following national shell egg prices as available, for December 1^st 2023 in the Egg Markets Overview report for dozen cartons with comparable prices in parentheses for the previous week: -

Retail Prices

Large, in cartons generic white: $1.36 Unchanged ($1.36)

Large, in cartons cage-free brown: $3.49 Up 43.6 percent ($2.43)

Wholesale

Large C-F, California in Cartons: $3.18 Unchanged ($3.18)

National loose, (FOB dock): $1.19 Down 19.6 percent ($1.48)

NYC in cartons to retailer: $2.02 Down 16.8 percent ($2.43)

Regional in cartons to warehouse December 1^st.

Midwest $2.29 Up 1.3 percent ($2.26)

Northeast $2.34 Up 1.3 percent ($2.31)

Southeast $2.43 Unchanged ($2.43)

South Central $2.45 Up 1.2 percent ($2.42)

Combined $2.38 Up 1.3 percent ($2.35)

WEEKLY ADVERTISED PRICES OF SHELL-EGG CATEGORIES DECEMBER 1^st

USDA Certified Organic, Brown, Large: $4.44 ($4.97)

Cage-Free Brown, Large: $3.47 ($2.31)

Omega-3 Enriched Specialty, White, Large: $2.35 ($2.74)

Generic White, Large Grade A $1.48 ($1.40)

Generic White, Large Grade A featured $1.36 ($1.36)

* USDA adjusted from previous week

The advertised price for Large white grade A over 1,353 stores posted for the week ending December 1^st was $1.48 per dozen, up $0.08 per dozen or 5.7 percent from the previous week at $1.40 per dozen. Shelf prices will influence demand for generic categories given their availability and the comparison with higher advertised and actual shelf prices for specialty and cage-free brown eggs. Current supply was above demand this past week. Previously stock levels were distorted by reduced deliveries over the post-Thanksgiving period. Independent producers continue to divert shell eggs from breaking to market. Large integrated companies and packers continued to deliver to DCs and this week chains should increase orders to restock.

The USDA benchmark-advertised retail price for certified organic for the week was $4.44 per dozen, down $0.53 per dozen or 10.6 percent from the USDA price of $4.97 per dozen based on 1,594 stores. A USDA advertised price of $3.47 per dozen was posted for cage-free brown during the past week (2,056 stores), up $1.16 per dozen or 50.2 percent over last week at $2.31 per dozen. The price differential between USDA organic and cage-free brown of $0.97 cents per dozen in favor of certified organic will attract purchasers at the expense of cage-free brown eggs. Week-to-week single digit fluctuations expressed as a percentage can be expected in the stock of specialty and organic eggs based on the small base of these categories. There was an obvious upward movement in the inventory of cage-free and specialty categories this past week consistent with decreased demand.

White shelled cage-free eggs were advertised at $3.00 per dozen (27 stores) and were $0.47 per dozen or 13.5 percent lower than brown cage-free eggs at $3.47 per dozen this past week.

USDA data on advertised promotional retail prices this week indicated a shelf price of $1.48 per dozen for generic Large white compared to a composite wholesale price of $2.38 per dozen delivered to DCs. This represented a theoretical U.S. negative retail margin of 60.8 percent on average, for featured generic Large (last week a negative margin of 72.8 percent) categories. Demand will increase as retailers constrain markups.

Certified organic was promoted this past week at 21.0 percent of the total, consistent with a lower inventory, (last week 49.9 percent of features). Omega-3 enriched comprised 17.0 percent of features with lower inventory (16.7 percent last week). Cage-free was at 27.5 percent despite higher stock (23.7 percent last week). Large at 30.9 percent (9.4 percent last week) comprised the noteworthy generic size featured. This confirms that retailers promote any category if available in excess of demand.

USDA Cage-Free Data

According to the latest monthly USDA Cage-free Hen Report released on December 1^st 2023, the number of certified organic hens was unchanged from November 2023 at 18.9 million, (rounded to 0.1 million).

The USDA reported that the cage-free (non-organic) flock in November 2023 was down 1.1 from October 2023 to 106.3 million, (rounded to 0.1 million).

According to the USDA the population of hens producing cage-free and certified organic eggs in November 2023 comprised: -

Total U.S. flock held for USDA Certified Organic production = 18.9 million (18.7 million in Q3 2023).

Total U.S. flock held for cage-free production = 106.3 million (105.4 million in Q3 2023).

Total U.S. non-caged flock =125.2 million (124.1 million in Q3 2023).

This total value represents 38.5 percent (October, 38.9 percent) of a nominal 325 million total U.S. flock pre-HPAI in 2022 (but 38.7 percent of the national flock after HPAI mortality to a presumed December complement of 323 million in production). Hens certified under the USDA Organic program have decreased in proportion to cage-free flocks since Q1 of 2021.

The accuracy of individual monthly values is questioned given a history of either sharp changes or no change in successive months as documented over the past two years. Precise quarterly reports would be more suitable for the industry in planning expansion and allocation of capital.

Processed Eggs

For the processing week ending December 2^nd 2023 the quantity of eggs processed under FSIS inspection during the week as reported on December 6^th 2023 was up 14.4 percent compared to the previous processing week to a level of 1,521,833 cases, (1,329,248 cases last week). The proportion of eggs broken by in-line complexes was 52.1 percent (56.8 percent in-line for the previous week). The differential in price for shell sales and breaking will determine the movement of uncommitted eggs. This past week 70.2 percent of egg production was directed to the shell market, (73.9 percent for the previous week) responding to the differential in prices paid by breakers and packers. Breaking stock inventory was up 1.0 percent this past week to 348,900 cases with continued diversion to shell-egg markets. Apparent demand from QSRs and casual dining is at stable to slightly higher levels. There is ongoing demand from baking and eat-at-home despite the weekly fluctuation in the inventory of breaking stock. During the corresponding processing week in 2022 in-line breakers processed 50.2 percent of eggs broken.

For the most recent monthly report, revised data for October 2023, yield from 6,204,925 cases (6,277,558 cases last month) denoted an increase in demand for liquid over the period October 1^st through October 28^th 2023. Edible yield was 38.5 percent, distributed in the following proportions expressed as percentages: - liquid whole, 61.9; white, 22.8; yolk, 11.8; dried, 3.4.

All eggs broken during 2022 attained 76.22 million cases, 2.0 percent less than 2021. Eggs broken in 2023 to date amounted to 72.15 million cases, 1.8 percent more than the corresponding period in 2022. This is attributed to moderately increased demand for egg liquids from retail, food service and QSRs and casual dining restaurants. The market is constrained by economic uncertainty following the ending of COVID supports, inflation, high credit card interest rates and purchasing of only essentials by consumers

PRODUCTION AND PRICES

Breaking Stock

The average rounded price for breaking stock was unchanged this past week at $1.12 per dozen with a range of $1.10 to $1.13 per dozen delivered to Central States plants on December 4^th. Checks were unchanged this past week at an average of $1.01 per dozen over the most frequent range of $1.00 to $1.02 per dozen suggesting that the market for breaking stock generally lags shell eggs following sharp up or down swings in shell prices.

Shell Eggs

The USDA Egg Market News Report dated December 4^th 2023 confirmed that Midwest wholesale prices for Extra-large and Large sizes were lower by an average of 13.8 percent over the previous week. Mediums were down 14.4 percent. A lower price following a transitory rise but after a protracted plateau in the benchmark price with declining inventory, suggests that the market is currently operating with reduced demand. The following table lists the “most frequent” ranges of values as delivered to warehouses*: -

*Store Delivery approximately 5 cents per dozen more than warehouse price

The December 4^th 2023 Midwest Regional (IA, WI, MN.) average FOB producer price, for nest-run, grade-quality white shelled Large size eggs, with prices in rounded cents per dozen was down 19.4 percent from last week, (with the previous week in parentheses): -

1. $1.74 ($2.14), (estimated by proportion): L. $1.70 ($2.11): M. $1.61 ($1.99)

The December 4^th 2023 California price per dozen for cage-free, certified Proposition #12 compliant Large size in cartons delivered to a DC, (with the previous week in parentheses) was down 11.3 percent from last week.

1. $2.89 ($3.25); L. $2.82 ($3.18); M. $2.63 ($2.81)

Shell-Egg Demand Indicator

The USDA-AMS Shell Egg Demand Indicator for December 6^thwas down 12.8 points from the last weekly report to -6.3 with a 7.0 percent increase in total inventory and a 8.4 percent higher shell inventory from the past week as determined by the USDA-ERS as follows: -

The 1^st Quarter results for Cal-Maine Foods, the November Export Report and the USDA Monthly Report for October 2023 including text, tables, data and prices can be accessed under the STATISTICS tab.

Dried Egg Products

The USDA extreme range in prices for dried albumen and yolk products in $ per lb. was released on December 1^st 2023. Data posted by the USDA is incomplete but available values are depicted for the past week and in parentheses for the previous week and also past months to illustrate the trend in prices influenced by HPAI depopulation and subsequent repopulation:

Frozen Egg Products

The USDA range in prices for frozen egg products in cents per lb. based on the extreme range on December 1^st compared to the previous week showed fluctuation in price:-

 Whole egg: Up 0.9%; Whites: Down 9.1%; Yolks: Up 7.5%;

This indicated a relative increase in demand for whole egg and yolks from the manufacturing and food service sectors:

November averages (October): Whole. $1.11, ($1.04); Whites, $1.08, ($1.09); Yolks, $1.87, ($1.95).

1. extreme range

Liquid Egg Products

Values for Whites and Yolks covering certified truckload quantities have not been released for the past ten weeks. Whole egg values were not released last week. November averages (cents per lb.) are compared with October values (in parentheses): -

Whole, $0.85, ($0.76); Whites, $0.68 ($0.68); Yolks, $1.72, ($1.68).

The USDA has not released a report on dried egg inventory since March 13^th 2020 due to inability to obtain data from producers, and will not issue reports for the immediate future.

COMMENTS

The initial report of HPAI in the egg production sector during 2023 occurred in a small commercial egg-producing flock in Montana seven weeks ago followed by cases in Minnesota, Iowa, California and Ohio over the past six weeks requiring depopulation of 5.2 million hens. In contrast to 2022, broiler flocks are affected with cases in California and in Arkansas this past week. Outbreaks of HPAI continue among growing flocks and some breeder turkeys in six states. There have been increases in the number of cases recorded in wild birds and backyard flocks (43 year-to-date) in addition to free-living predatory and scavenging carnivorous mammals. Given the risks and consequences of infection it will be necessary to continue to maintain high levels of structural and operational biosecurity with intensification during early winter months. HPAI is now frequently diagnosed in breeding colonies of marine birds in costal areas of Europe and sporadically in commercial flocks. This has implication for trans-Atlantic dissemination following the pattern in the 4^th quarter of 2021 extending into 2022. Outbreaks in commercial flocks appear to be correlated with shedding of AI virus by migratory birds.

Approximate losses in commercial flocks confirmed with HPAI and updates during the 2022/3 epornitic included:-

• 3,500,000 broilers on 22 farms in 7 states during 2023
• 330,000 broiler breeders on 11 farms in 6 states.
• 270,000 upland game birds in Alabama during late October 2023.
• 13,100,000 turkeys including a few breeder flocks in 7 states during 2022 and through 2023 year-to-date. During the past six weeks losses have approximated 1.3 million growing turkeys with 47 incident cases confirmed in six states (SD; ND; UT; MN; IA; WI).
• 45,650,000 egg-production hens in total with 95 percent on 30 large complexes above 0.5 million in addition to 1,070,000 pullets with a total of 48 locations in 12 states. Pullet mortality does not include “at risk” replacements depleted on affected complexes with contiguous pullet rearing. One case involving 50,000 hens was recorded in Montana on October 3^rd with subsequent cases in MN, IA and OH with 5.2 million hens depleted

Losses during the past week ending December 6^th were:- 

• Turkeys and breeders 247,000. SD; WI; OH and MN
• Broilers 621,000. CA and AR.
• Egg-production 83,000 (CA)
• Non-WOAH 8 outbreaks in 5 states

Backyard flocks (non-WOAH) allowed outside access will continue to be at risk of infection in the U.S. These small clusters of birds in both suburban and rural areas are of minimal significance to the epidemiology of avian influenza as it affects the commercial industry. Backyard flocks serve as indicators of the presence of virus among free-living birds as evidenced by ongoing outbreaks in commercial poultry flocks across the U.S.

The USDA-APHIS published a report on the results of epidemiologic studies* available on July 25^th. Results on 18 egg-production case farms and 22 control farms suggested higher risk of infection associated with the presence of a farm in a control zone, proximity of wild birds, mowing or bush hogging vegetation adjacent to the farm, and off-site disposal of routine mortality. These factors suggest possible aerogenous introduction of virus shed by wild birds onto farms over short distances. Protection was enhanced by effective structural and operational biosecurity. The validity of findings was limited by the confounding inherent to the diversity in size of flocks incorporated into the case-control study and deriving data from a 26 page questionnaire by telephone survey, months after outbreaks, introducing recollection bias and responder fatigue.

*Green, A. et al Investigation of risk factors for introduction of highly pathogenic avian influenza H5N1 virus onto table egg farms in the United States, 2022: a case-control study. Frontiers in Veterinary Science. Doi: 10.3389/vets.2023.1229008

It is hoped that APHIS recognises the need to provide the industry with science-based recommendations to prevent additional incident HPAI outbreaks. This presumes prompt analysis and reporting of whatever field and molecular epidemiology that is collected. The Agency is also presumed to have planned epidemiologic field studies and allocated personnel and other resources since a late fall resurgence in HPAI is evident. Since three complexes in as many states were infected during November guidance from USDA is anticipated by the Industry.

 WEEKLY ECONOMY, ENERGY AND COMMODITY REPORT: December 8^th 2023.

 OVERVIEW

At 14H00 on December 7^th the CME price for corn was up 1.7 percent compared to the previous week to 468 cents per bushel for December delivery. Prices of commodities were influenced by profit taking, and a realization of the size of the 2023 crop. Export orders for the current year have increased sharply and prices are indirectly influenced by events in the Black Sea. Orders by China resumed at the end of the 2022-2023 market year and have extended into December. The production and demand for ethanol were higher this past week. Prices are fairly stable in advance of the December WASDE.

Soybeans were down 2.2 percent from last week to 1,313 cents per bushel for January 2024 delivery. Prices during the week generally responded to the size of the 2023 crop, export orders and predicted ending stocks.

Soybean meal was down 3.6 percent to $425 per ton for December delivery. Price was influenced by demand coupled with record high crush volue in October. Price will fluctuate to reflect the CME price for soybeans and the demand for soy oil that is rising. The market previously responded to increased crop size and higher stocks included in the November WASDE Report reflecting the 2023 crop.

 WTI was 8.1 percent lower from last week to $69.74 on December 6^th, attributed to lower demand and higher U.S. and world reserves despite the possible effect of conflict in the Middle East and threats of production cuts by OPEC. There was a pronounced downward trend in price during the week ($75.96  to $69.81). Crude oil inventory in the U.S., other than the Strategic Reserve, was up to 29.6 million barrels from 27.7 million barrels, last week.

Factors influencing commodity prices in either direction over the past four weeks included:-

• Weather conditions in areas of the World growing corn and oilseeds especially in Brazil with favorable rain under the influence of a strong El Nino event. The 2023 U.S. harvest is functionally complete and ahead of 2022 (downward pressure).

• Geopolitical considerations continue to move markets. Cancellation of the BSGI in July and ongoing attacks on Ukraine port facilities impact prices of wheat, corn, oilseeds and vegetable oils. Russia has unsuccessfully attempted to implement a Black Sea blockade on Ukraine that raises prospects for further asymmetric responses by Ukraine and even possible international intervention. Loaded bulk vessels are sailing from Chornomorsk,  Odesa and also from Danube River ports using the ‘Humanitarian Corridor” to various destinations. The costal route is operational despite threats by the Russian Federation to mine the entrance to ports and deploy airborne missiles. (Upward pressure on corn and wheat and an indirect effect on soybeans)

Macroeconomic U.S. factors:-

• Most economists in academia and the private sector are confident of a “soft landing” for the economy following the release of Q3 GDP and recent economic parameters despite high bond rates. Inflation as measured by CPI declined from 8.9 percent in June 2022 to 3.0 percent in October. This is in part the response to a series of 11 FOMC raises that cooled the labor market without precipitating unemployment. There is evident stability in the bank sectors in both the U.S. and Europe. Large U.S. banks passed stringent “stress tests” in June.

• The Federal Reserve held the benchmark interest rate steady at the monthly FOMC meeting on November 1^st.  The Federal Reserve commentary indicated that the rate would be held high for a prolonged period in the range of 5.25 to 5.50 percent. This stand-fast approach is opposed by many economists and Wall Street is looking forward to rate cuts in 2023. Chairman Powell in Congressional testimony and documented in FOMC minutes has indicated that additional increases might be expected with observers anticipating one more rate hike in early 2024 to restore inflation to near an annual 2.0 percent target by 2025. The value of 2.0 percent is now being questioned as a valid target.  

• On November 30^th the Department of Commerce announced that the inflation rate in October attained 3.0 percent year-over-year, down from a 3.4 percent rate in September.

• The November 29^th announcement of Q3 GDP confirmed a second estimate value of 5.2 percent, above the previous estimate of 4.9 percent mainly due to consumer spending and investment in inventory. In Q2 GDP growth attained 2.1 percent.

• The November 14^th release of the October CPI confirmed a zero increase from September. The annual increase of 3.2 percent was the lowest rate since March 2021. The increase in the core value (minus food and energy) was 0.2 percent, in line with estimates.  Food at home was up 0.3 percent from the previous month. Food away from home was up 0.4 percent from September 2022. Energy was down 2.5 percent, mainly due to gasoline and diesel fuels. The shelter category was up 0.5 percent. The macro trend is clearly towards reduced inflation due to a fall in energy prices. The CPI influences FOMC rate decisions.

• On November 30^th the Bureau of Economic Analysis released the October Personal Consumption Expenditure index. This parameter closely followed by the Federal Reserve fell to 3.0 percent year-over-year from 3.4 percent in September. The core value, minus fuel and food fell to 3.5 percent from 3.7 percent in September.

• The October Producer Price Index for Final Demand (PPI) released on November 15^th fell 0.5 percent from September that registered a 0.5 percent increase. The projection for October was for a 0.1 increase. The fall was attributed mainly to a 15.3 percent lower price of gasoline.  The core PPI value excluding volatile fuel and food, was down 0.1 percent for the month and down 2.9 percent from October 2022. Wholesale food was down 0.2 percent compared to a 0.7 percent increase in September.

• A Federal Reserve release on November 16^th confirmed that industrial production declined 0.6 percent in October and was up 2.5 percent over the third quarter. Capacity utilization decreased 0.6 percent to 78.9 percent, 0.8 percent below the 1972-2020 average. The decline was attributed to labor action impacting the auto industry during October.

• According to a December 4^th release by the U.S. Census Bureau the Manufacturers’, Shipments, Inventories and Orders (M3) Survey, determined that new orders in October decreased by 5.4 percent, following a rise of 4.0 percent in September.

• The November 15^th release of retail sales data showed a monthly fall of 0.1 percent in October. This value was below the revised September value of 0.9 percent. The Federal Reserve closely monitors this index as a measure of the trend in inflation. 

• The ISM® Services Index for November rose to 52.7 from 51.8 in October. The November Prices Index was 58.3, lower than in October at 58.3 driven by lower labor and energy costs.

• The Conference Board Consumer Confidence Index released on November 28^th for October/November, rose to 102.0 points, up from a revised 00.1 for the preceding four-week period.

• The University of Michigan Index of Consumer Sentiment released on November 22^nd fell from 63.8 in September/ October to 61.3 for October/ November. Both the Current Economic Index (70.6 down to 68.3) and the Index of Consumer Expectations (59.3 down to 56.8) denote a decline in consumer sentiment extending to the fourth consecutive month influenced by high interest rates and geopolitical concerns.

• Non-farm payrolls increased by 199,000 during  November, as documented by the Bureau of Labor Statistics on December 8^th. This was slightly higher than the estimate of 185,000. The increase is attributed to workers in the auto and entertainment industries returning to work. The unemployment rate fell from 3.9 to 3.7 percent. The average hourly wage rate in November was up 0.4 percent from October and 4.0 percent year-over-year at $34 per hour. Wage rates are closely followed by the Federal Reserve FOMC.

• The Bureau of Labor Statistics Job Openings and Labor Survey report on December 5^th estimated 8.7 million job openings in October down from 9.2 percent for September and below the 9.4 percent estimate. The October job openings number was the lowest value in 30 months.

• Initial jobless claims released on December 6^th attained 220,000 for the week ending December 5^th, up 1,000 from the revised value for the previous week and lower than the Reuters estimate of 222,000. The four-week moving average amounted to 220,000. The Bureau of Labor Statistics estimated 1.86 million continuing claims during the last week of November. There is evidence from November data that the labor market is cooling.

• The December 6^th Bureau of Labor Statistics report recorded a 5.2 percent increase in non-Farm Productivity for Q3; Unit Labor Cost was down by 1.2 percent on a normalized basis and Hours Worked was up by 0.9 percent in Q3.

• The ADP® reported on December 6^th that private payrolls increased by 103,000 in November, down 10,000 from 113,000 in October and compared to an estimate of 128,000 jobs. The increase in employment was mostly in the service sector. Annual pay was up 5.6 percent year-over-year. The increase will not directly influence the probability of short-term future changes in interest rate since the ADP® is regarded by the FOMC as an unreliable statistic.

FACTORS INFLUENCING COMMODITY PRICES

• The 2023 harvests of corn and soybeans are essentially complete. The December WASDE will provide an update on yields, volume and ending stocks that are not expected to deviate from the November release.

• It is evident that both polarization in the closely divided chambers of Congress and intra-party conflict between and among both sides of the House will delay adoption of appropriations bills. Passage of the 2023 Farm Bill will be contentious and is subject to a 12-month extension as a stop-gap measure. Progress on the 2023 Farm Bill has been impeded by contention over SNAP eligibility and other entitlements that collectively represent 75 percent of total expenditure. The August 2^nd downgrade of U.S. debt from AAA to AA+ by Fitch Ratings recognizes Congressional dysfunction. On November 10^th Moody’s downgraded U.S. credibility from ‘stable’ to ‘negative’ based on an inability to pass required fiscal legislation. The House failed to pass eleven appropriations bills and passed an 11^th hour continuing resolution deferring action to November 17^th to finance the Federal government.. Again failure to enact appropriations bills resulted in a second continuing resolution on November 15^th freezing spending at FY 2013 levels pending votes on appropriations with extended deadlines of January 19^th and February 2^nd 2014. Little progress is apparent in the closely divided House under current leadership. A Federal shutdown would impact equity and commodity markets and the image of the U.S. governmental system.

• The November 9^th WASDE #642 updated soybean production and predicted a record corn harvest for the new crop. There will be ample world availability of ingredients although inequitable distribution will result in shortages in some nations. Soybean exports will comprise 40 percent of the new crop with a rise in ending stock.  (See WASDE Report in this edition confirming availability, use and ex-farm price projections)

• There is an expectation that for market-year 2023-2024, Brazil will achieve a record soybean harvest of 162 million metric tons (5,951 million bushels) with exports of 100 million metric tons (3,674 million bushels) and will crush 56 million metric tons (2,057 million bushels). A corn harvest of 130 million metric tons (5,117 million bushels) is anticipated with export of 54 million metric tons (2,125 million bushels). (Lower prices in the future subject to favorable reports on crop progress and actual harvests)

• The Dollar Index (DXY) was 104.2 on December 6^th, up 1.4 points from last week reversing declines in November. The DXY has ranged from 99.9 to 106.8 over the past 52-weeks. The dollar index influences timing and volume of export orders and indirectly the price of WTI crude.

EXPORTS

The FAS Export Report, released on December 7^th for the week ending November 30^th reflected carry-over of corn from market year 2022-2023. The report confirmed that outstanding export orders for corn amounted to 17.04 million metric tons (670.7 million bushels). Net orders for the past week for the 2023-2024 market year amounted to a substantial 1.29 million metric tons (50.8 million bushels). Shipments recorded during the past working week amounted to 1.09 million metric tons (42.7 million bushels). For the current market year to date cumulative export of 8.71 million metric tons (342.7 million bushels) is 30.4 percent higher compared to the equivalent week of the previous market year. For market year 2024-2025 outstanding orders attained 1.06 million metric tons (41.8 million bushels) with 22,900 metric tons (0.9 million bushels) sold this past week

(Conversion 39.36 bushels per metric ton.  Quantities in metric tons rounded to 0.1 million)

The FAS Export Report for the week ending November 30^th reflecting market year 2023-2024 with carry-over from the previous market year, recorded outstanding export orders for soybeans amounting to 14.08 million metric tons (517.2 million bushels). Net orders this past week attained 1.52 million metric tons (55.7 million bushels).  Shipments for the past working week attained 1.34 million metric tons (49.05 million bushels). For the current market year to date cumulative exports of 18.32 million metric tons (673.18 million bushels) are 13.1 percent lower compared to the equivalent week of the previous market year.  Outstanding orders for the 2024-2025 market year are 9,000 metric tons  (330,000 bushels) with no new sales this past week.

 (Conversion 36.74 bushels per metric ton)

For the week ending November 30^th 2023 outstanding orders for soybean meal and cake with carry-over attained 4.13 million metric tons. Net orders this week for soybean meal and cake amounted to 110,000 metric tons. During the past week 373,100 metric tons of meal and cake combined was shipped. The quantity exported to date is 27.8 percent higher than the volume for the corresponding weeks of the previous market year. For the next market year outstanding sales have attained 5,200 metric tons with 500 metric tons ordered this past week.

The November 9^th 2023 WASDE confirmed:-

• Corn area planted for all purposes in 2023 (‘new crop’) attained 94.9 million acres, up 6.4 percent or 5.6 million acres from last year. Compared with the 2022 season, planted acreage is expected to be up or unchanged in 43 of the 48 estimating States. According to the November WASDE, yield was raised to 174.9 bushels per acre with a resulting 2,156 million bushel ending stock. The USDA lowered the average season ex-farm price to 485 cents per bushel.

• Soybean area planted for 2023 attained 83.6 million acres, down 5.1 percent from 88.1 million acres last year. Compared with last year, planted acreage is down or unchanged in 21 of the 29 estimating States. According to the November WASDE yield was raised 0.6 percent to 49.9 bushels per acre with a resulting 245 million bushels ending stock. The USDA retained an average season price of 1,290 cents per bushel.

• Crushers are expected to produce 54.15 million tons of soybean meal. Ending stocks will attain 400,000 tons. The USDA retained a price of  price of $380 per ton.

The preference for planting corn over soybeans was based on a favorable projection of the corn to soy benefit ratio during March 2023.

COMMODITY PRICES

The following quotations for the months of delivery as indicated were posted by the CME at 14H00 on December 7^th 2023, compared with values at 15H00 on November 30^th 2023  (in parentheses): -

Changes in the price of corn, soybeans and soybean meal over five trading days this past week were:-

Corn:                   Dec. quotation up 8 cents per bushel.                (+1.7 percent)

Soybeans:          Jan. quotation down 30 cents per bushel          (-2.2 percent)

Soybean Meal:  Dec. quotation down $16 per ton                        (-3.6 percent)

The CME spot prices for feedstuffs per short ton at close of trading on December 6^th 2023 with prices for the previous week were:-

• Corn (ZC): $173 per ton. Up $3 per ton from the previous week (+1.8 percent). 52-week range $166 to $246

• Soybean Meal (ZM): $408 per ton was $427. Down $19 per ton (-4.5 percent) from the previous week. 52-week range $370 to $4.96

Values for other common ingredients per short ton:-

• Meat and Bone Meal, (According to the USDA National Animal By-product Feedstuffs Report on December 1^st): $350 to $400 per ton (Av. $375 per ton) for porcine (ex MN);  $300 to $335 per ton (Av. $320 per ton) for ruminant (ex MN). Price varies according to plant and location  

• According to the USDA National Mill-Feeds and Miscellaneous Feedstuffs Report on December 1^st wheat middlings from St. Louis, MO.  and other states: $155 to $195 per ton (Av. $175 per ton)

• According to the University of Missouri Extension Service current  By-Product Feed Price Listing for November/December DDGS, (IA. and other states) was priced at $200 to $260 (Av. $225 per ton). Price varies according to plant and location and is expected to fluctuate with the price of corn

• Bakery Meal, (MO & TX): $190 to $220 per ton.

• Rice Bran, (AR & TX): $150 to $200 per ton. (Av. $175).

For each $1 per ton (2.8 cents/bushel) change in corn the cost of egg production would change by 0.11 cent per dozen

For each $10 per ton change in the price of soybean meal the cost of egg production would change by 0.35 cent per dozen

The respective changes in the spot prices of corn and soybean meal on December      6^th compared with November 30^th would decrease nest-run production cost for eggs by 0.3* cent per dozen. *(Rounded to 0.1cent)

ENERGY

The latest U.S. Energy Information Administration (U.S. EIA) report estimated that fuel ethanol blending would average 990,000 barrels per day in 2023, up 1.2 percent from 2022. For the week ending December 1^st, 94.5 percent (88.8 percent previous week) of the U.S. ethanol fermentation volume was operational, based on January 2023 U.S. EIA capacity of 1,152 million barrels per day. The outlook for increased production will depend on higher domestic demand, from summer driving in addition to increasing the quantity that is exported.

During September 2023  (the last month for which US Energy Information Administration data is available) ethanol exports were up 19.4 percent from August to 122 million gallons (2.916 million barrels). Importing nations and regions of significance and their proportions of total volume (rounded) for the month included:-  49 percent to Canada; 17 percent to Europe; 10 percent to the Middle East; 7 percent to Asia; 5 percent to Central and South America and the Caribbean; 5 percent to Mexico;.

According to the U.S. EIA, for the week ending December 1^st 2023 the industry produced on average 1,076,000 barrels of ethanol per day, up 6.4 percent from the week ending November 24^th 2023 but remaining solidly above the one million gallon per day benchmark. On December 1^st ethanol stock was up 0.3 percent from the previous week to 21.4 million barrels, an approximately 20-day reserve. This past week demonstrated a noteworthy demand for ethanol, given relative changes in the weekly production level and stock.

Current Energy Prices:-

• Ethanol quoted on the CME (EH) on December 6^th was priced at $2.16 per gallon, unchanged for months due to lack of trading activity. The 52-week range is $2.14 to $2.19 per gallon.

• On December 6^th RBOB gasoline traded on NASDAQ (RB) at $2.03 per gallon, down 16 cents (7.3 percent) from the previous week reflecting the current low WTI price that is now evident on the CME and at the pump. The 52-week range for RBOB gasoline is $2.15 to $2.96.

• Despite announced production cuts in the face of increased demand for fuel, together with turbulence in the Middle East, the WTI crude price was relatively stable this week. An OPEC+ suggested production cut that commenced in July in addition to a voluntary one-million barrel per day reduction by Saudi Arabia announced on June 4^th will be extended through January 2024. The cut will be extended by an additional 0.7 million barrels per day but it is questioned whether many members of OPEC will comply. Price was up $0.76 per barrel, (1.0 percent) to $77.86 per barrel on November 29^th compared to the previous week. The ending stock of crude at Cushing OK. on December 1^st was up 6.6 percent to 29.6 million barrels from last week, 31.7 percent down from season high on June 23^rd 2023. Hydrocarbon sources of energy contributed materially to inflation in the third quarter compared to the previous quarter of 2023 but will be an important contributor to deflation in the fourth quarter.

• The AAA national average regular grade gasoline price was $3.21 per gallon on December 6^th, down four cents per gallon (1.2 percent) from last week. Gasoline is now $1.05 per gallon more expensive than ethanol but has a 63 percent higher BTU rating. Future rises in fuel cost are inevitable given the increases in benchmark WTI

• The AAA national average diesel price was $4.17 per gallon on December 6^th, down six cents per gallon (1.4 percent) from the previous week but with prospects for future increases due to an extremely low national stock despite a falling WTI price.

• CME Henry Hub natural gas was priced at $2.56 per MM BTU on December 6^th down 24 cents (8.6 percent) from the previous week

INGREDIENTS

DDGS is freely available with most plants among the 192 operational on January 1^st 2023 (the last available estimate) with a combined capacity of 1,152 million barrels per day functioning at 94.5 percent. The current University of Missouri Extension Service By-product Feed Price Listing for November/December priced DDGS at $200 to $260 per ton, with an average of $225 per ton from MO. Poet plants). Wide variation in price exists depending on supplier, quantity and location. It is axiomatic that the cost of DDGS will reflect changes in the price of corn with an appropriate lag period. Generally DDGS is currently incorporated at moderate inclusion levels in egg-production formulas based on price relative to the nutrient contribution of corn and other ingredients. This will change as corn and hence DDGS fluctuate in price

The CME soybean price for January 2024 delivery at 15H00 on December 7^th was down 1.1 percent to 1,343 cents per bushel. The current price of soybeans is a reflection of availability for domestic crushing, consumption and export orders. Soybean meal was down 3.7 percent on the CME to $441 per ton for December 2023 delivery. Prices of soybeans are obviously influenced by projections of harvest in the three major producing nations in South America, the size of the drought-impacted harvest in the U.S. coupled with domestic and international demand for soy oil and meal.

According to a release on November 15^th by the National Oilseed Processors Association, whose members process 95 percent of the U.S. crop, a record crush for October attained 189.8 million bushels of soybeans. This was higher than the consensus of estimates averaging 187.2 million bushels. Crush volume was up 14.7 percent from the previous month of September 2023, at 165.5 million bushels and 2.9 percent above September 2022 at 184.5 million bushels. The November crush data will be posted in the December 22^nd edition of EGG-NEWS.

On December 6^th the CME spot price for soybean oil was down 3.1 cent per lb. (5.9 percent) from the previous week to 49.5 cents per lb. Prices for vegetable oils have fluctuated over past weeks but have fallen with recent increases in supply in relation to demand. Asian crude palm oil fell this past week. It is anticipated that 41 percent of U.S. soy oil was diverted from fuel to biodiesel during 2022.

On December 6^th the soybean meal spot price quoted on NASDAQ was $408 per ton, $19 per ton lower than the spot price last week and compared to a 52-week range of $370 to $496 per ton.

On December 6^th Meat and Bone meal (porcine) was priced over a range of $350 to $400 per ton (Av. $375 per ton) according to the USDA National Animal By-product Feedstuffs Report, Prices quoted were for Minnesota plants but with a wide range based on composition, source and location. Price fluctuation reflects changes in soybean meal and other oilseed meals.

On December 6^th the conversion of the CNY to the BRL was BRL 0.69 unchanged from last week. The conversion of the CNY to the US$ was CNY 7.14 down CNY 0.05 from the previous week indicating relative strengtheningof the US$ .

For consecutive calendar years 2017 through 2019 the U.S. supplied 34.4 percent of soybean requirements for China amounting to 95.5 million metric tons. This was followed by a decline to 16.9 percent of 88.5 million metric tons in 2018 and 16.6 percent of 88.0 million metric tons in 2019. The USDA anticipated that soybean imports by China would attain 95.0 million metric tons during the 2020-2021 market year but in reality only 60.3 million tons was shipped through August 2021.

For the 2021-2022 market year net export sales of corn were down 21.5 million metric tons (844 million bushels) compared to the previous market year with cumulative exports of 38.3 million metric tons (1,507 million bushels) 

For the 2022-2023 market year net export sales of soybeans were down 5.6 million metric tons (206 million bushels) compared to the previous market year with cumulative exports of 51.5 million metric tons (1,893 million bushels)

For Market year 2022-2023 ending September 2023, a record 13.2 million metric tons of soybean meal and cake was exported valued at $7 Billion. Expansion in exports was attributed to orders from The E.U., Asia (Viet Nam) and Latin America. Crush volume was driven by the demand for soy oil to produce biodiesel fuel.

During calendar 2022, 58.0 million metric tons (2,243 million bushels) of corn were exported from the U.S., valued at $18,609 million. The top five importers with their respective values expressed as a percentage were: China, 28.2; Mexico, 26.4; Japan, 16.0; Canada, 7.2 and Colombia, 5.3.

During calendar 2022, 57.2 million metric tons (2,099 million bushels) of soybeans were exported from the U.S., valued at $34,392 million. The top five importers with their respective values expressed as a percentage were: China, 72.6; Mexico, 14.8; E.U., 11.3; Egypt, 6.1 and Japan, 7.3.

COMMENT

Subscribers are referred to the November 9^th 2023 WASDE #642, the USDA Planted Acreage Report and the quarterly Grain Stocks Report posted under the STATISTICS Tab.

Following cancellation of the Black Sea Grain Initiative (BSGI) Ukraine commenced limited shipment of commodities from the three main Black Sea and Danube Delta ports that remain functional. Since mid-September Ukraine claims to have shipped 300,000 metric tons of grains (corn, wheat and barley) through the Humanitarian Corridor. Projected harvest during the 2022/2023 season will amount to 49.0 million metric tons, 42 percent lower than for 2021/2022. Exports were projected to attain 38.1 million metric tons, 26.5 percent lower than the previous market year.

Either more intense action by Ukraine, a negotiated peace treaty with concessions to the Russian Federation, or their combination will be required to restore unrestricted shipping in the Black Sea. Limited passage through the costal-route (“Humanitarian Corridor”) has allowed sea-transport of commodities since early August to supply Asia and Africa.

According to an advisory from the USAPEEC, Mexico imposes statewide bans on all poultry products following a diagnosis of HPAI.  Currently affected states include Arkansas, Oregon, Maryland, Ohio, Wisconsin and Georgia.  SENASICA, the authority responsible for animal health will downgrade the state to county level following information on the extent of outbreaks and surveillance to be provided by APHIS.

Negotiations are necessary to confine previously agreed  bans on export to County, not State

The annual International Poultry Scientific Forum (IPSF) co-sponsored by the Southern Poultry Science Society, the Southeastern Conference on Avian Diseases and USPOULTRY will take place on Monday, January 29th through the morning of Tuesday, January 30th 2024.  As in previous years, the IPSF will be held concurrently with the 2024 International Production and Processing Expo (IPPE).

Pre-registration is $95 through January 12th.  Complimentary registration is offered to students.

For information concerning the IPSF and IPPE access  <ippeexpo.org>.

An allocation of $3.1 billion in assistance for distressed farm loans will be derived from the Inflation Reduction Act.  Since this legislation was enacted in August 2022 the Farm Service Agency has distributed $1.7 billion in assistance to more than 30,000 distressed borrowers.

The latest tranche announced on November 30^th will include $80 million for 210 delinquent borrowers flagged for liquidation. In addition 1,120 borrowers will receive $128 million as  direct emergency loans.

Secretary of Agriculture Tom Vilsack stated, “At USDA we are working hard every day to keep farmers on their farms.  With the Inflation Reduction Act we began charting a different course than the one taken during the farm financial crisis in 1980’s.

Providing delinquent borrowers with additional funding may save some farms but the underlying problems that created financial distress must be addressed and resolved otherwise public funds will be spent in simply prolonging inevitable failure.  It is understandable that farmers that have been impacted by climatic extremes or events beyond their control should receive assistance over and above insurance.  Simply supporting inefficient farming operations or incompetent farmers or those unable to achieve profitability is not a rational albeit humane strategy. Disbursing public funds to farmers in distress without remedying causes for suboptimal financial performance is fiscally unacceptable.

Veterinary diagnosticians in Argentina have reported mortality due to HPAI in James’ flamingos (Phoenicoparrus jamesi).  This “near threatened” species occurs on mountain lakes at high altitude in Argentina, Bolivia, Chile and Peru.  To date 221 flamingos have been found dead in the Province of Catamarca as a result of H5N1 infection.  Enigmatically, two other species of flamingo that cohabit with the James’ species have not been affected suggesting investigation of either epidemiologic or immunologic factors involved.

Producers of animal protein are adopting a proactive approach to counteract anticipated attacks on intensive meat and poultry production at the COP28.  The North American Meat Institute and the Protein PACT will “engage at the highest levels”.  PACT (People, Animals and Climate of Tomorrow) will have a prominent position at the Americas Pavilion and will sponsor the Inter-American Institute for Cooperation on Sustainable Agriculture.  The joint action between PACT and the IICA will include a reception with guest speakers including the Minister of Livestock, and agricultural officials of Uruguay. 

The message to be conveyed by the U.N. Food and Agriculture Organization will be that developed nations “over-consume meat” citing per capita data. This is a blatant attempt to shame industrialized countries such as the U.S., Canada and western European nations to reduce demand for poultry and meat products.

The Department of Labor, Occupational Safety and Health Administration (OSHA) imposed a $280,000 penalty on Sugar Creek Packing Company for severe injuries sustained by a worker after coming into contact with corrosive chemicals.

Investigation of the case disclosed that there were deficiencies in lockout procedures, failure to provide protective clothing resistant to corrosive chemicals and inadequacies in training among service and maintenance personnel.

Sugar Creek Packing has violated safety regulations since 2014 with repeat findings in 2019 and 2022 for similar hazards at the Washington Court House and Fairfield Plants.  OSHA area director, Ken Montgomery noted, “despite multiple employee injuries and repeated OSHA citations, Sugar Creek Packing Company continues to ignore federal regulations and industry-recognized safety requirements to protect employees from harm, including amputation and other hazards.”  He added, “The company’s recent workplace safety failures allowed an employee to suffer painful and preventable injuries”. Sugar Creek Packing Company employs over 2,000 at six plants in Ohio, Indiana and Kansas.

While the OSHA fine may appear high it reflects the gravity of repeated serious violations.  Ultimately, Sugar Creek Packing Company will be subject to a civil claim. In view of the injuries sustained and the obvious negligence involved this incident will result in a substantial out-of- court settlement since a negotiated resolution will certainly be cheaper than a jury verdict especially if punitive damages are awarded.

A case filed November 29^th in the Superior Court of the District of Columbia alleges that Cargill, Inc., Mondelez and Mars, Inc. are indirectly supporting child labor through their purchase of cocoa from nations in West Africa.  The Plaintiffs allege indifference by the U.S. companies to labor practices in Ghana.  The complaint alleges that companies are aware of pervasive exploitation of child labor in the cocoa supply chain despite pledges to eliminate unacceptable practices.  Cargill, Inc. in response stated, “Forced child labor is unacceptable, and we take these allegations very seriously.”

Allegations of exploitation of child labor in developing nations with extreme poverty reflect the realities of existence.  It is, however, more concerning that human trafficking, employment of minors even with parental consent and other forms of exploitation have been revealed in the     supply chains of the U.S. food industry. 

It will be impossible to eliminate undesirable practices in nations supplying agricultural commodities to the U.S. if we ourselves cannot eliminate undesirable and exploitive practices in agriculture as documented in recent actions by the Departments of Labor and Homeland Security.

A November report to the World Organization of Animal Health confirmed four outbreaks of Newcastle disease (paramyxovirus 1) in flocks in Poland, Two of the outbreaks involved 45,000 laying hens in Topilek and 28,000 in Bojary, both in Podlaskie Voivodeship (Province) in the northeast quadrant of the nation, adjoining Lithuania. Two small farms in the locality were also infected. The last outbreaks of Newcastle disease diagnosed in Poland occurred in 1971 attesting to the efficacy of vaccination.

According to the WOAH report, flocks were not vaccinated against Newcastle disease.  The only other outbreak of this infection reported during the past year comprised two cases in Denmark where farmers do not routinely vaccinate flocks against Newcastle disease contrary to universal practice. 

Raw milk distributed by Utah Natural Meat and Milk dairy in West Jordan, UT. was recalled after a trace-back from 12 patients with campylobacteriosis.  The action taken by the Department in September has now been rescinded and the dairy is allowed to distribute raw milk subject to monthly sampling and testing.  Campylobacter entered milk produced by the dairy through either direct or indirect fecal contamination.  It is evident that the intestinal tracts of dairy cows on the farm are colonized with Campylobacter, and it is inevitable that additional cases will occur. 

The decision to allow distribution of raw milk from the West Jordan facility and from 15 other licensed farms in the state is questioned.  This is supported by a statement by the Department, “Raw milk, no matter how carefully produced, may be unsafe.  Individuals who choose to consume raw milk or raw milk products are advised to take steps to decrease the chance of raw milk causing food-borne illness including Heating raw milk to 165 degrees F for at least 15 seconds and cooling it before consuming.  This statement merely supports the need for pasteurization.  There is no reason to purchase raw milk and then to home-pasteurize it when commercial milk is available that has been subjected to pasteurization applying HACCP.

The Commissioner of Agriculture, Craig Buttars, stated, “While we did not take suspending the license of this small farm and business lightly, it was important that we ensure that milk products were safe for consumption.  We are grateful for the efforts by the UDAF team and the dairy owners to isolate the cause of the illness and to ensure that milk is safe to be sold once again.”  It is scientifically implausible that any “precautionary measures” can prevent contamination of raw milk with Campylobacter, Salmonella, STEC, and other pathogens that are destroyed by pasteurization.

In Utah, raw milk can only be sold directly to consumers at a farm.  Federal law prohibits interstate transport since the inherent dangers of raw milk are recognized and incorporated into federal codes.

Last week, EGG-NEWS reported on the adverse verdict in Kraft Foods Global, Inc. et al. v United Egg Producers, Inc., et al. in the U.S. District Court for the Northern District of Illinois.  A jury verdict ruled that the Defendants, Cal-Maine Foods, Rose Acre Farms and the UEP had effectively colluded to reduce production following adoption of the UEP Animal-Welfare Certified Program over twenty years ago.  On December 1^st, the jury awarded Plaintiffs $17.8 million in damages plus attorneys’ fees.

In a filing with the SEC, Cal-Maine Foods noted that the jury decision is not final and has petitioned for a directed verdict setting aside the jury finding in favor of the Plaintiffs and their assignment of damages.

Cal-Maine Foods is confident in their assertion that the Plaintiffs’ claim is contrary to law since they advocated for and knowingly purchased eggs that were produced in accordance with the UEP Certified Program.  Cal-Maine also correctly states that the Defendants represented only 15 percent of the market and could therefore not have been in a position to influence prices irrespective of the allegations of indirect collusion by adhering to the UEP Animal-Welfare Certified Program.

Following reports of HPAI at both Reichardt Duck Farm and Sunrise Farms, in Sonoma County, a member of the faculty at the College Veterinary Medicine, University of California at Davis raised the question of agro-bioterrorism in an interview with the Sonoma County Press Democrat.  It is a matter of record that the activist organization Direct Action Everywhere (DxE) was responsible for intrusion into both operations as long as two years ago.  There is no epidemiologic evidence that their activity was in any way associated with outbreaks. 

It is indeed unfortunate and irresponsible on the part of the UCD veterinarian interviewed who provided a guide to would be activists “to contaminate their sneakers with goose droppings and enter a farm.”  This apparently casusl banter with reporters simply provideed those opposed to intensive livestock production with suggestions that they may or may not have independently developed. 

When interviewed by the media it is best not to speculate and to confine comments to scientific fact, remembering that nothing is ever “off record”.

The House Natural Resources Water, Wildlife and Fisheries Subcommittee recently held a hearing on the damage caused by black vultures (Coragypts atratus).  The population of these birds is placed at close to 200 million in the U.S. following a 50-year period of federal protection. Permits are issued to limit local populations of black vultures if they are responsible for livestock losses especially among calves.  The Black Vulture Relief Act is advocated by the National Cattlemen’s Beef Association and has bipartisan support in the House.

From a poultry perspective, black vultures may play a role in dissemination of HPAI.  They will naturally feed on dead migratory waterfowl and become infected.  Duration of shedding of HPAI virus by the species should be evaluated and their possible role in the epidemiology of avian influenza should be investigated. 

Black vultures were recently used as a test species before vaccinating endangered California condors with avian influenza vaccine.  According to recent reports presented at regional meetings, vultures develOOOoped protective antibody levels after two successive doses of administration of either one or two successive doses of inactivated H5 vaccine.

The Administration has announced agreements with the Imperial Irrigation District that will result in conservation of 100,000 acre-feet of water in Lake Mead during the current year.  In total, 18 agreements have been concluded to save 350,000 acre-feet of waOOOter in Lake Mead in 2023 and up to one million acre-feet through 2026.

The Department of the Interior will provide funding through the Infrastructure and Inflation Reduction Acts that will include: -

• $281 million for 21 water recycling projects.
• Up to $233 million in water conservation funding including pipelines to supply the Gila River Indian Community.
• $73 million for infrastructure repairs for water delivery systems.
• $71 million for 32 drought-resiliency projects to store rainwater and recharge aquifers.
• $70 million to improve infrastructure on the upper Colorado River basin and to facilitate surface and ground water storage.

The November 15^th release of the Producer Price Index issued by the U.S. Bureau Labor of Statistics denoted the sharp decline in egg prices from highs in October 2022, during the HPAI recovery phase, to the corresponding month in 2023.  Over the twelve months, egg prices at the farm level declined by 59.7 percent.  Year to date egg prices declined by 28 percent.  In contrast, egg prices increased by 17.1 percent in 2021 due to increased demand as a result of COVID buying patterns. Prices increased by 163.1 percent in 2022 attributed to HPAI depletion. 

For 2023, the USDA Economic Research Service forecast a 31.8 percent mid-range decline in farm egg price in 2023.  For 2024 a 25.7 percent decline was projected with an understandably wide range from -70.0 percent to +95.9 percent.  Uncertainty is obviously a reflection of the unpredictability in the future incidence of HPAI.  The price-elasticity of eggs is denoted by a 160 percent increase in farm price during 2022 against an average reduction of 10 percent in supply. Availability of shell eggs was constrained by two seasonal waves of infection resulting in depopulation of a total 44 million hens. Biphasic mortality resulted in an approximately 22 million reduction in the national producing flock on a constant weekly basis.

This past week, APHIS and the California Department of Food and Agriculture confirmed outbreaks of HPAI at the Reichardt Duck Farm housing 170,000 birds and Sunrise Farms with 80,000 hens held for egg production. The outbreaks are in a region with a high density of small to medium-size commercial egg production operations, and with a profusion of backyard farms and collections of game fowl. 

Given recent cases of HPAI in Fresno, Merced and San Benito counties, authorities have advised farmers to confine flocks, invoking emergency organic rule provisions mandating outside access.  The fact that HPAI was identified in a free-living bird in the area during June suggests that H5N1 avian influenza virus may have become endemic in domestic birds and dissemination of virus is not confined to seasonal migration.

Ms. Priya Sawheny, a DxE activist pleaded guilty to two counts of trespassing arising from demonstrations that occurred in May 2018 and June 2019.  She was sentenced to 100 hours of community service to be completed in Sonoma County.  She is restrained from coming in close proximity to both the Sunrise Farm and the Reichardt Duck Farm.  Wayne Hsiung a leader of Direct Action Everywhere (DxE) was found guilty of two counts of conspiracy and trespassing.

Over the years DxE has illegally entered farms and removed poultry allegedly subject to cruelty, claiming that California laws gave them the right to “rescue animals in distress”.

Authorities in Cambodia are investigating two cases of avian influenza in human contacts of backyard poultry in Kampot Province. A 21-year-old woman who handled dead chickens developed clinical symptoms on November 19^th and died on November 26^th.  A four-year-old girl also with known contact with infected chickens was diagnosed with the infection on November 25^th and was subsequently released from hospital after treatment.  No further cases were diagnosed in either of the villages that were home to the two patients.  Four previous cases of avian influenza in humans were diagnosed in Kampot Province in 2023.

While sporadic cases restricted to individuals with presumed susceptibility are not an immediate cause of concern, the World Health Organization (WHO) Endemic Influenza Preparedness Framework is developing policy and plans in advance of a possible extension of infection from domestic poultry to human populations.  Numerous reports of infection in free-living terrestrial and marine mammals confirm that H5N1 virus can mutate to infect a wide range of species.  Obvious animal-to-animal transmission must have occurred among seals and sealions along the Pacific coast of South America and on a farm housing mink in Spain.

The World Health Organization noted, “As is often stated an influenza pandemic is not a matter of “if” but rather “when”.  The Agency is applying lessons learned during the COVID pandemic to prepare for a possible influenza event over the period 2024 through 2030 in the High-level Implementation Plan III.  This will strengthen pandemic influenza preparations by building capacities in the areas of:

• Policy and plans in the event of emergence of a pandemic

• Collaborative global influenza surveillance and response

• Community protection

• Access to control measures

A combined initiative by the USDA, the USEPA and the USFDA is aimed at reducing food loss and waste by 50 percent by 2030.  It is estimated that among 100 million tons of municipal waste, food and organic material comprise close to two-thirds of the total.

The national strategy for reducing food loss and waste and recycling organics represents the collaborative activities among the three Agencies.

This strategy will include: -

• Preventing loss of food.
• Preventing wastage of food.
• Increased recycling for organic waste.

The respective contributions of the three Agencies will include: -

• FDA and USDA will evaluate and change date labeling and food safety advice.
• FDA will pursue digital tracing technology to identify and remove contaminated foods from supply chains.
• FDA will facilitate food donations by modifying the food code.

It is anticipated that the national strategy will increase food access to those in need, create new jobs and improve resiliency of the food supply chain and ultimately lower the cost of food for households.

Public comment on the proposed national strategy is solicited from December 5^th onwards.

The Department of Labor (DOL) Wage and Hour Division has obtained a court ordered settlement of $3.8 million against The Exclusive Poultry Inc. and owner Tony Brand.  According to court records the company paid workers less than the statutory rate including overtime, and reduced the wages of workers cooperating with DOL.  It is also alleged that the company employed minors as young as 14 on cut-up lines and to operate potentially dangerous mechanical equipment.  Brand used front companies to employ workers in his La Puente and City of Industry, CA. plants.  The court order imposed $3.5 million in back wages and damages to workers, $300,000 in punitive damages, $100,000 in back wages withheld as retaliation and $200,000 in civil penalties.

Going forward, Exclusive Poultry must retain a monitor for a three-year period to ensure compliance with federal and state labor regulations.

Yonhap News Agency of South Korea has reported a diagnosis Oof H5N1 highly pathogenic avian influenza on a duck farm in Goheung.  No further details concerning the number of birds were provided in the news report.

The significance of this case is that migratory birds have commenced shedding in South Korea with the prospect of further outbreaks on commercial farms. Extensive losses have occurred in previous years impacting the egg sector. This required imports of shell eggs and egg liquid to satisfy domestic demand.

Para State in Brazil has over 24 million head of cattle on close to 300,000 farms extending over an area representing France, Spain and Norway combined.  Para is the second largest beef producing state after Mato Grosso.  The Integrity Program will mandate tracking of all cattle in order to control illegal deforestation of the Amazon rain forest. 

The program was announced at the U.N. COP 28 Climate Summit in anticipation of Para serving as the host for the COP30 Climate Summit in 2025.  In the absence of a traceability program for cattle, producers and traders were at a disadvantage as multinational corporations including JBS and Cargill are insisting on transparency to limit deforestation.

The USDA Food Safety and Inspection Service announced that Pelleh Poultry Company of Swan Lake, NY. has recalled 700 pounds of ready-to-eat beef and poultry products.  Recall was initiated following isolation of Listeria monocytogenes on routine QC.  This case illustrates the need for processors and manufacturers to have access to a laboratory capable of screening for or isolating bacterial pathogens.  Early detection resulted in a prompt recall avoiding possible cases of listeriosis among consumers. There have been no reports of infection to date.

Dr. Brian Jordan UGA

Dr. Brian Jordan of the University of Georgia Departments of Poultry Science and Population Health will present a seminar entitled “Evaluating IB vaccine take by real-time PCR”.  The role of infectious bronchitis in depressing growth and increasing plant condemnation and a reducing egg production is well established.  Despite the availability of a broad range of live attenuated IB vaccines, clinical problems occur in the field attributed to defective vaccination.  The presentation by Dr. Jordan will demonstrate the role of PCR in evaluating immunity after administration of IB vaccines at day of hatch.  The program will stress sample size, timing of sampling and interpretation of results.

The event will take place from 12H00 to 13H00 EST on January 31^st, 2024, in meeting room TBA at the Georgia World Congress Center.

For registration access www.eventbrite.com/e/ippe-luncheon-evaluating-ib-vaccine-take

USDA will make available $300 million in funding to support new projects intended to open new markets and to expand existing markets under the Regional Agricultural Promotion Program. The intended allocation is from the $1.2 billion available over a five-year period from the Commodity Credit Corporation.

Secretary Vilsack stated, “It takes significant investment to open and develop new export markets and this new fund will be dedicated to helping provide start-up capital so that American exporters can diversify their markets and create new opportunities.”

Funding under the Regional Agricultural Promotion Program is available to agricultural trade organizations, U.S. agricultural cooperatives and state regional trade groups operating approved market development activities. In order to concentrate funding on new markets and opportunities, the nations of the E.U. and China, Canada, Mexico will be ineligible for funding.  In contrast, emphasis will be placed on Africa, Latin America and the Caribbean and Southeast Asia.

Trade promotion involving undifferentiated commodities can evolve into an exercise of pushing a piece of string.  Commodities are purchased in a competitive market environment based on landed cost and the needs of the purchasing nation.  For many years, this commentator along with colleagues undertook promotional seminars in Asia and the Middle East on behalf of the American Soybean Association.  The premise was that promoting domestic production of eggs and broilers through technology transfer would create more viable poultry industries, creating a demand for soybeans.  In many cases, the information did, in fact, help develop industries in India, Pakistan, Thailand, China and the Middle East. The activities of speakers and experts did little to generate goodwill that translated to preferences for the U.S. Importers in host nations understandably sourced soybeans from the best available and cheapest supplier with FOB price, sea freight and seasonal availability being the principal determinants of the purchase decision. An unintended consequence of promotional activities was the inevitable decline in chicken exports to many countries that imposed barriers to imports to protect their emerging industries. The situation was further complicated when U.S. experts were sponsored by commodity associations to present programs on further-processing and packaging thereby creating competition for U.S. exporters in many regional markets. This was ironically to the detriment of the associations’ best customers, the U.S. domestic broiler industry.

Funding the promotion of an undifferentiated commodity by an association may create awareness for a product but this will not necessarily establish a preference for a national supplier. The major U.S. commodity associations have been unsuccessful in identifying superior attributes for GMO corn, soybeans or wheat or establishing quantifiable product differentiation for their commodities among the competing major world exporters.

Considerable progress has been made by industry organizations such as USAPEEC that together with USDA-APHIS have worked to remove artificial trade barriers and to update unrealistic regulations that represented restraints to trade.  Local product demonstrations and promotions have increased awareness and demand for turkey, duck and broiler products in Latin America and the Caribbean and in some cases in Asia. This is reflected in direct and indirect benefits for some segments of the industry.

 It is hoped that USDA will be able to monitor and quantify the effect of their “investment” in promotion.  Public funds are easy to disburse, especially when vast sums of money, that add to the national debt, are made available.  USDA intends that the regional agricultural promotion programs should be confined to nonprofits and commodity associations. A more effective and less expensive approach might be to grant tax concessions and other incentives to the private sector to stimulate exports.  At the end of the day, neither the U.S. Soybean Association nor the U.S. Grains Council actually sell a single bean or kernel. This is the province of the big five multinational agribusiness conglomerates responsible for the bulk of world trade in commodities. 

Is it the intention of the USDA through regional agricultural promotion programs simply to increase the sale of dairy products, endives or similar minor agricultural commodities to Costa Rica and other nations? Is the U. S. taxpayer going to recognize a return on the considerable amount to be assigned to this program? How will it be measured? Who will take responsibility if there is no positive return? Inquiring minds want to know!