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Egg Week

11/27/2019

USDA Weekly Egg Price and Inventory Report, November 27th 2019.

  • Hen numbers in production up 1.7 million to 333.6 million .
  • Shell inventory down 3.0 percent after a 3.6 percent drop in previous week
  • USDA Midwest benchmark generic prices for Extra large and Large up 6.2 and 6.3 percent respectively to 153.5 and 151.5 cents per dozen. Mediums were unchanged at 94.5 cents per dozen. An increase in USDA benchmark price for the fourth consecutive week confirms that prices are moving up from a prolonged 8-month depressed market. Midwest prices for all sizes are now above nest-run production cost.
  • Price of breaking stock unchanged at 77.0 cents per dozen. Checks unchanged at 63.0 cents per dozen reflecting shell-egg prices. Both categories are now above the cost of production

OVERVIEW

Prices

According to the USDA Egg Market News Reports posted on November 25th the Midwest wholesale prices for Extra Large and Large as delivered to DCs were 6.2 and 6.3 percent higher at 153.5 and 151.5 cents per dozen respectively. Mediums were unchanged at 94.5 cents per dozen reflecting availability. Prices were above the USDA average 5-Region blended nest-run benchmark of 60.2 cents per dozen in October, excluding provisions for packing and transport. The progression of prices during 2019 is depicted in the USDA chart reflecting three years of data, updated weekly.

The November 25th USDA Egg Market News Report (Vol. 66: No. 47) documented a USDA Combined Region value rounded to the nearest cent, of $1.51 per dozen delivered to warehouses for the week ending November 20th. This average price lags current Midwest weekly values by one week. The USDA Combined range for Large in the Midwest was $1.43 per dozen. At the high end of the range, price in the South Central Region attained $1.57 per dozen. The USDA Combined Price last week was approximately $0.02 per dozen below the three-year average and $0.14 per dozen above the price during the corresponding week in 2018.

Flock Size

According to the USDA the number of producing hens this week was up 1.7 million to 333.6 million. The hen population is more than adequate to meet seasonal consumer and industrial demand in late November but any number above 330 million in production over the short term transitioning to December, portends lower than average prices and increased inventory unless matched by proportional demand that is currently apparent. The total U.S. egg-flock comprised 339.3 million hens including second-cycle birds and those in molt on all farms. The difference of 5.7 million hens in production and total hens is equivalent to 1.7 percent (2.0 percent last week) of the national flock, down from a YTD high of 2.4 percent in mid-June. This suggests that there are fewer pullet flocks to commence production and possibly less molted flocks scheduled to come back into production. This has implications for price, given current supply, stock level and seasonally moderate to rising demand. The higher average weekly production and static price for Mediums is attributed to young pullets placed for seasonal sales that have entered production.

STOCK LEVELS

Generic shell-egg stock was down 3.0 percent to 1,409,600 cases. To maintain prices the market, will have to find a balance between supply and demand as the Industry moves through the fourth quarter of 2019, Seasonally the eleventh month of the year is characterized by increasing flock size and fluctuating prices but trending higher, depending on supply.

The National stock of frozen egg products as reported by the USDA on November 22nd 2019 attained 33.6 million pounds (15,290 metric tons) on October 31st 2019

Dried-egg inventory reported on November 8th decreased by 0.6 percent during October 2019 to 22.66 million lbs. (10,300 metric tons) on October 31st 2019, (was 22.81 million lbs. on September 30 th 2019).

INVENTORY

Cold Storage

Cold storage stocks in selected regions on November 25 th amounted to 2.537 million pounds (1,153 metric tons) of frozen egg products, down 2.0 percent from the level of 2.689 million lbs. on November 1st 2019.

The most recent monthly USDA Cold Storage Report released on November 22nd documented a total stock of 33.6 million pounds (15,290 metric tons) of frozen egg products on October 31st 2019. This value was up 11.1 percent from October 31st 2018. A total of 90.8 percent of combined inventory comprised the categories of "Whole and Mixed" (50.0 percent) and "Unclassified" (40.8 percent). The lack of specificity in classification suggests a more diligent approach is required to enumerate and report inventory by the USDA.

Shell Inventory

The national stock of generic shell eggs reflecting November 25 th 2019 was down 3.0 percent from the past week, following a decrease of 3.6 percent for the previous week and an increase of 3.3 percent during the preceding week. Small fluctuation in weekly stock levels suggests that the market is now in balance relative to increased supply. Old flocks continue to be molted and have not been depleted. Hen numbers are still too high moving into winter but are following seasonal trends. Availability of shell eggs has increased over past months from the contribution of newly transferred pullets and molted hens coming back into production. In addition pullet chicks placed during early to mid-July 2019 are now producing a disproportionate number of medium sized eggs as denoted by the price for this size although demand for the category from food service has increased.

Three USDA Regions reported lower stock levels. The Midwest Region was down by 9.1 percent compared to the previous week to 438,100 cases. This region was followed in decreasing order of stock level by the Southeast Region, down 1.6 percent to 261,400 cases; the South Central Region up 3.3 percent to 234,700 cases; the Southwest Region up 4.2 percent to 194,000 cases; the Northeast Region down 8.3 percent to 167,300 cases and the Northwest Region up 3.5 percent 114,100 cases.

The total of the USDA six-area stock of commodity eggs comprised 1,715,100 cases, of which 82.2 percent were shell eggs. The inventory of breaking stock was up 2.5 percent to 305,500 cases consistent with the trend in shell-egg price in recent weeks. The value of breaking stock and hence availability from both mature and young flocks will be influenced by the demand for generic shell eggs and contract obligations with breakers.

As of Monday November 25th 2019 the inventory of other than generic eggs (with previous week in parentheses) comprised:-

· Specialty category, up 1.2 percent to 40,200 cases. (was up 4.2% to 39,700 cases)

· Certified Organic, down 2.7 percent to 132,000 cases. (was down 0.5% to 135,600 cases)

· Cage-Free, down 1.7 percent to 122,700 cases. (was down 3.2% to 124,800 cases)

There were firm indications from equipment manufacturers and builders and evidenced by interest at the Midwest Poultry Federation Convention during the first quarter, that expansion is either planned or is in progress despite low prices from April through early November. It is estimated that orders for 7 million to 10 million hen places have been signed, mainly for aviaries, despite the reality that wholesale prices for generic cage-derived eggs were below production cost for the past seven successive months. Whether this proposed volume will be housed according to plan or delayed, is a matter or conjecture. One of two proposed large aviary complexes representing 2 million hens in Ohio is apparently going forward pending permits. A second complex for three million hens in Wisconsin has applied for permits in anticipation of a rise in demand for cage-free eggs.

The projected increase in cage-free flocks is supported by quarterly USDA statistics, the November 6th 2018 passage of California Proposition #12 and subsequent corresponding legislation by Oregon and Washington States. The Supreme Court declined to consider the multi-state challenge to California Proposition #2 and the Massachusetts ballot outcomes.

The Fourth Quarter financial report for FY 2019 from Cal-Maine released on July 22nd indicated that the company would house an additional 6.0 million hens in cage-free systems representing replacement of existing flocks and new facilities, requiring conversions and erection of housing and packing plants to the value of $187 million. Projects with a capital cost of $167 million might be completed through February 2020. The 1 st Quarter report for FY 2020 posted by Cal-Maine Foods on September 30th noted progress on projects initiated. The Q1 FY 2020 report posting a substantial loss, implied restraint in conversion to cage free going forward. It is evident that there is overproduction of cage-free eggs based on the differences between Nielsen sales data and the average weekly figures posted by the USDA in the Monthly Cage Free Report indicating that a proportion of cage-free and organic eggs produced are currently either downgraded or sent to breakers

Demand for cage-free eggs is influenced by the relative shelf prices of the category in comparison with generic white-shelled eggs from caged flocks. 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. Similarly, consumers purchase white-shelled generic eggs in preference to brown-shelled cage-free with a differential of over $1.20 per dozen. The need for structured statistically relevant market research on the willingness to pay for attributes such as housing, GM status and nutritional enrichment is self-evident.

RELATIVE PRICES OF SHELL-EGG CATEGORIES

The following advertised retail prices for the week ending November 28 th 2019, (compared with the previous week in parentheses) were posted by the AMS on November 25th for dozen packs:

· USDA Certified Organic, Brown, Large: $3.85 ($3.64)

· Cage-Free Brown, Large: $2.55 ($2.79)

· Omega-3 Enriched Specialty, White, Large: $2.29 ($2.43)

  • Generic White, Large Grade AA $1.00 ($1.07)

· Generic White, Large Grade A (Feature price) $1.06 ($1.09)

The retail price as determined by the USDA-AMS for generic white Large AA last week was down $0.07 per dozen to $1.00 although the decrease in price will not materially influence rising seasonal demand. Relatively stable to declining stock levels and a welcome three-week rise from the apparent market bottom suggests a firming of prices in the near term if demand responds to lower prices of generics and other categories.

During the present week the USDA benchmark-advertised retail price of brown Cage-Free fell by 8.6 percent or $0.24 per dozen to $2.55 per dozen. Certified Organic rose by 5.8 percent or $0.21 per dozen to $3.85 per dozen widening the advertised price differential to $1.30 per dozen ($0.85 per dozen last week) suggesting a higher demand for certified organic over cage-free brown. The differential between advertised retail prices for generic white Large and cage-free brown was $0.97 per dozen ($1.72 per dozen last week) suggesting more demand for cage-free brown over generic white. Preference for generic white over cage-free brown is evident with a price differential greater than $1.20 per dozen. Large week-to-week percentage fluctuations can be expected in the stock of specialty and organic eggs based on the small base of these categories.

USDA Cage-Free Data

According to the latest monthly USDA Cage-free Hen Report released November 5th 2019 the number of cage-free hens in October increased by 2.6 percent. The population of hens producing cage-free and certified organic eggs increased in October as follows:-

Total U.S. flock held for USDA Certified Organic production = 16.1 million (15.8 million May to Sept.).

Total U.S. flock held for cage-free production = 54.2 million (52.7 million Sept.).

Total U.S. non-caged flock = 70.3 million (68.5 million Sept.).

This total value represents 21.3 percent of a nominal 330 million U.S. flock but 31.5 percent of a presumed flock of 223 million producing for the shell-egg market.

Processed Eggs

For the processing week ending November 23rd 2019 the quantity of eggs processed under FSIS inspection as reported on November 27 th was down by 0.5 percent compared to the previous week to a level of 1,552,245 cases. The proportion of eggs broken by in-line complexes was 57.7 percent (was 58.1 percent last week). With higher prices for shell eggs there is a trend to divert non-contracted eggs from breaking to shell-egg sales. During the corresponding processing week in 2018 in-line breakers processed 53.2 percent of eggs broken.

For the monthly report dated November 13th edible yield for the period September 29th through November 2nd from 8,239,525 cases was 38.5 percent, distributed in the following proportions expressed as percentages:- liquid whole, 53.5; white, 24.4; yolk 12.1; dried, 5.0.

All eggs broken YTD 2019 attained 75.05 million cases, 3.9 percent more than the corresponding period during 2018. The difference is in part due to significantly higher prevailing shell-egg prices in 2018 favoring shell sales.

PRODUCTION AND PRICES

Breaking Stock

The price range for breaking stock delivered to Central States plants was unchanged over a range of 76 to 78 cents per dozen. Checks were unchanged over a range of 61 to 65 cents per dozen. The revenue for both breaking stock and checks was higher than the benchmark production cost for nest-run, estimated by the USDA at 60.2 cents per dozen during October 2019.

Shell Eggs

The USDA Egg Market News Report released on November 25 th documented an approximately 9 cent per dozen increase in Midwest prices for Extra Large and Large. The following table lists the "most frequent" ranges of values as delivered to warehouses*:-

Size/Type

Current Week

Previous Week

Extra Large

152-155 cents per dozen

143-146 up 6.2%

Large

150-153 cents per dozen

141-144 up 6.3%

Medium

93-96 cents per dozen

Unchanged

Certified Organic EL

275-310 cents per dozen

Unchanged long term

Breaking stock

76-78 cents per dozen

Unchanged

Checks

61-65 cents per dozen

Unchanged

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

The November 25th 2019 Regional (IA, WI, MN.) average FOB producer prices, for nest-run grade-quality white shelled eggs, with prices in rounded cents per dozen (last week in parentheses) were:-

EL. $1.36 ($1.31) estimated by proportion: L. $1.34 ($1.29): M. $0.70 ($0.75)

(See the text, tables and figures and the review of production data and prices comprising the November report on USDA October 2019 costs and 1 st Quarter financial results posted by Cal-Maine Foods under the statistics TAB.)

Shell-Egg Demand Indicator

The USDA-AMS Shell Egg Demand Indicator for November 27th 2019 was numerically higher by 6.1 points from the last weekly report to +9.4 with a 3.0 percent lower inventory from the past week as determined by the USDA-ERS as follows:-

Productive flock

333,574,333 million hens

Average hen week production

82.3% (was 81.1%)

Average egg production

274,531,676 million per day

Proportion to shell egg market

70.9% (was 70.2%)

Total for in-shell consumption

540,679 cases per day

USDA Inventory

1,409,600 cases

26-week rolling average inventory

4.67 days

Actual inventory on hand

4.27 days

Shell Egg Demand Indicator

+9.4 points (was +3.3 points on November 20th )

Dried Egg Products

Prices for dried egg products (most frequent price with a range in $ per pound) effective November 25th 2019 were:-

 

Whole Egg

$2.10-$2.30

Unchanged

Yolk

$2.05-$2.15

Unchanged

Spray-Dried White

$4.80-$5.00

Unchanged

Blends

$2.75-$2.80

No new quotation

U.S. dried egg inventory on October 31st 2019, as reported on November 8th 2019 was 26 percent lower than on October 31 st 2018 attaining 22.66 million lbs. (10,300 metric tons), equivalent to approximately 1.6-weeks current production. Inventory was 0.7 percent lower compared to September 30th 2019. During the period September 29th 2019 through November 2nd 2019, dried egg processed under USDA inspection amounted to 13.45 million lbs. Lower shell-egg prices during the past three months diverted non-contracted eggs from packing to breaking.

The October 31st total dried egg inventory comprised whole egg (43.9%); albumen (22.8%); yolk (31.2%) and blends (2.0%).

COMMENTS

Newcastle Disease

The incidence rate of Newcastle disease in Southern California declined over the past three months and no cases were diagnosed for eight consecutive weeks. A case was reported from a feed store on August 14 th followed by a spontaneous case in a vaccine-production flock in San Diego County on August 31st and then in a backyard flock on September 9th. Two new cases were diagnosed on adjacent backyard farms in San Bernardino County on November 14th and 20 th with an additional case in a feed supply store also on November 20th. To declare the 2018 - 2019 outbreak officially over will require 13 weeks from depletion of the last diagnosed case. Given experience with Newcastle disease in small flocks in a given area it is inevitable that incident cases will emerge from either introduction from Mexico or extension from unrecognized reservoirs in California. Investigation of the current incident cases is in progress and it is hoped that greater transparency and disclosure will be forthcoming than in past months. The progress of the outbreak was as follows:-

A total of 454 exotic velogenic viscerotropic Newcastle disease (vvND = END) cases in small multi-species backyard flocks mainly comprising gamefowl (fighting cocks) were confirmed between May 18th and November 22nd in the Southern California Counties of San Bernardino (146), Riverside (260), Los Angeles (45), Ventura (1), (San Diego (1) and Alameda (1). Pre-emptive slaughter of all "birds" (presumed to be domestic galliformes and some anseriforms) in four communities in Los Angeles, Riverside and San Bernardino Counties was conducted under the direction of the State Veterinarian for California in November 2018. This probably resulted in dissemination of infection by owners moving birds. A case of vvND was diagnosed in a flock of non-commercial chickens, presumed to be fighting cocks in Utah County, UT on January 18th.

A surge of incident cases was detected in Riverside County during mid-December 2018 with 43 incident cases diagnosed during the month. There were 86 new cases in January 2019, 48 in February, 22 during March, 17 in April, 20 in May and 1 in early June. In late March the USDA released funds from the 2015 HPAI outbreak but this may be characterized as too-little and too-late after 13 months. The decline in incidence rate is less attributed to the "control procedures" carried out by APHIS/CDFA than to immunity developing in flocks from vaccination and exposure of vaccinated flocks that will remain non-clinically affected reservoirs shedding virus in a cycle of exposure. Clearly many flocks are not identified or diagnosed given the relationship of owners of fighting cocks to federal and state agencies.

The END situation has not disrupted exports of raw poultry, breeding stock, hatching or table eggs or egg products to Mexico. Following negotiations after the index case of END was diagnosed in Los Angeles County during mid-May 2018, authorities in Mexico accepted regionalization and on May 23 rd restored importation of raw poultry from other than the restricted Counties in California. There is absolutely no reason to embargo pasteurized egg products derived from a USDA-FSIS inspected plant.

Avian Influenza

In the U.S. and the E.U. reassortant strains of avian influenza virus are introduced into regions beneath flyways by migratory birds and then transmitted to backyard and commercial free-range flocks or to confined flocks by deficiencies in biosecurity. Incident cases in the E.U., Asia and North Africa during 2018 should be a warning to U.S. producers during the fall and early winter of 2019 since the risk of infection necessitates enhanced biosecurity and effective containment.

There is a presumption that migratory waterfowl cease shedding AI virus by the first week of April, re-commencing in December. Accordingly, incresased biosecurity is required under the Pacific, Central and Mississippi flyways. Flocks allowed outside access during periods when migratory birds are shedding virus are vulnerable to infection.

matter or conjecture. One of two proposed large aviary complexes representing 2 million hens in Ohio is apparently going forward pending permits. A second complex for three million hens in Wisconsin has applied for permits in anticipation of a rise in demand for cage-free eggs.

The projected increase in cage-free flocks is supported by quarterly USDA statistics, the November 6th 2018 passage of California Proposition #12 and subsequent corresponding legislation by Oregon and Washington States. The Supreme Court declined to consider the multi-state challenge to California Proposition #2 and the Massachusetts ballot outcomes.

The Fourth Quarter financial report for FY 2019 from Cal-Maine released on July 22nd indicated that the company would house an additional 6.0 million hens in cage-free systems representing replacement of existing flocks and new facilities, requiring conversions and erection of housing and packing plants to the value of $187 million. Projects with a capital cost of $167 million might be completed through February 2020. The 1 st Quarter report for FY 2020 posted by Cal-Maine Foods on September 30th noted progress on projects initiated. The Q1 FY 2020 report posting a substantial loss, implied restraint in conversion to cage free going forward. It is evident that there is overproduction of cage-free eggs based on the differences between Nielsen sales data and the average weekly figures posted by the USDA in the Monthly Cage Free Report indicating that a proportion of cage-free and organic eggs produced are currently either downgraded or sent to breakers

Demand for cage-free eggs is influenced by the relative shelf prices of the category in comparison with generic white-shelled eggs from caged flocks. 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. Similarly, consumers purchase white-shelled generic eggs in preference to brown-shelled cage-free with a differential of over $1.20 per dozen. The need for structured statistically relevant market research on the willingness to pay for attributes such as housing, GM status and nutritional enrichment is self-evident.

RELATIVE PRICES OF SHELL-EGG CATEGORIES

The following advertised retail prices for the week ending November 28 th 2019, (compared with the previous week in parentheses) were posted by the AMS on November 25th for dozen packs:

· USDA Certified Organic, Brown, Large: $3.85 ($3.64)

· Cage-Free Brown, Large: $2.55 ($2.79)

· Omega-3 Enriched Specialty, White, Large: $2.29 ($2.43)

  • Generic White, Large Grade AA $1.00 ($1.07)

· Generic White, Large Grade A (Feature price) $1.06 ($1.09)

The retail price as determined by the USDA-AMS for generic white Large AA last week was down $0.07 per dozen to $1.00 although the decrease in price will not materially influence rising seasonal demand. Relatively stable to declining stock levels and a welcome three-week rise from the apparent market bottom suggests a firming of prices in the near term if demand responds to lower prices of generics and other categories.

During the present week the USDA benchmark-advertised retail price of brown Cage-Free fell by 8.6 percent or $0.24 per dozen to $2.55 per dozen. Certified Organic rose by 5.8 percent or $0.21 per dozen to $3.85 per dozen widening the advertised price differential to $1.30 per dozen ($0.85 per dozen last week) suggesting a higher demand for certified organic over cage-free brown. The differential between advertised retail prices for generic white Large and cage-free brown was $0.97 per dozen ($1.72 per dozen last week) suggesting more demand for cage-free brown over generic white. Preference for generic white over cage-free brown is evident with a price differential greater than $1.20 per dozen. Large week-to-week percentage fluctuations can be expected in the stock of specialty and organic eggs based on the small base of these categories.

USDA Cage-Free Data

According to the latest monthly USDA Cage-free Hen Report released November 5th 2019 the number of cage-free hens in October increased by 2.6 percent. The population of hens producing cage-free and certified organic eggs increased in October as follows:-

Total U.S. flock held for USDA Certified Organic production = 16.1 million (15.8 million May to Sept.).

Total U.S. flock held for cage-free production = 54.2 million (52.7 million Sept.).

Total U.S. non-caged flock = 70.3 million (68.5 million Sept.).

This total value represents 21.3 percent of a nominal 330 million U.S. flock but 31.5 percent of a presumed flock of 223 million producing for the shell-egg market.

Processed Eggs

For the processing week ending November 23rd 2019 the quantity of eggs processed under FSIS inspection as reported on November 27 th was down by 0.5 percent compared to the previous week to a level of 1,552,245 cases. The proportion of eggs broken by in-line complexes was 57.7 percent (was 58.1 percent last week). With higher prices for shell eggs there is a trend to divert non-contracted eggs from breaking to shell-egg sales. During the corresponding processing week in 2018 in-line breakers processed 53.2 percent of eggs broken.

For the monthly report dated November 13th edible yield for the period September 29th through November 2nd from 8,239,525 cases was 38.5 percent, distributed in the following proportions expressed as percentages:- liquid whole, 53.5; white, 24.4; yolk 12.1; dried, 5.0.

All eggs broken YTD 2019 attained 75.05 million cases, 3.9 percent more than the corresponding period during 2018. The difference is in part due to significantly higher prevailing shell-egg prices in 2018 favoring shell sales.

PRODUCTION AND PRICES

Breaking Stock

The price range for breaking stock delivered to Central States plants was unchanged over a range of 76 to 78 cents per dozen. Checks were unchanged over a range of 61 to 65 cents per dozen. The revenue for both breaking stock and checks was higher than the benchmark production cost for nest-run, estimated by the USDA at 60.2 cents per dozen during October 2019.

Shell Eggs

The USDA Egg Market News Report released on November 25 th documented an approximately 9 cent per dozen increase in Midwest prices for Extra Large and Large. The following table lists the "most frequent" ranges of values as delivered to warehouses*:-

Size/Type

Current Week

Previous Week

Extra Large

152-155 cents per dozen

143-146 up 6.2%

Large

150-153 cents per dozen

141-144 up 6.3%

Medium

93-96 cents per dozen

Unchanged

Certified Organic EL

275-310 cents per dozen

Unchanged long term

Breaking stock

76-78 cents per dozen

Unchanged

Checks

61-65 cents per dozen

Unchanged

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

The November 25th 2019 Regional (IA, WI, MN.) average FOB producer prices, for nest-run grade-quality white shelled eggs, with prices in rounded cents per dozen (last week in parentheses) were:-

EL. $1.36 ($1.31) estimated by proportion: L. $1.34 ($1.29): M. $0.70 ($0.75)

(See the text, tables and figures and the review of production data and prices comprising the November report on USDA October 2019 costs and 1 st Quarter financial results posted by Cal-Maine Foods under the statistics TAB.)

Shell-Egg Demand Indicator

The USDA-AMS Shell Egg Demand Indicator for November 27th 2019 was numerically higher by 6.1 points from the last weekly report to +9.4 with a 3.0 percent lower inventory from the past week as determined by the USDA-ERS as follows:-

Productive flock

333,574,333 million hens

Average hen week production

82.3% (was 81.1%)

Average egg production

274,531,676 million per day

Proportion to shell egg market

70.9% (was 70.2%)

Total for in-shell consumption

540,679 cases per day

USDA Inventory

1,409,600 cases

26-week rolling average inventory

4.67 days

Actual inventory on hand

4.27 days

Shell Egg Demand Indicator

+9.4 points (was +3.3 points on November 20th )

Dried Egg Products

Prices for dried egg products (most frequent price with a range in $ per pound) effective November 25th 2019 were:-

 

Whole Egg

$2.10-$2.30

Unchanged

Yolk

$2.05-$2.15

Unchanged

Spray-Dried White

$4.80-$5.00

Unchanged

Blends

$2.75-$2.80

No new quotation

U.S. dried egg inventory on October 31st 2019, as reported on November 8th 2019 was 26 percent lower than on October 31 st 2018 attaining 22.66 million lbs. (10,300 metric tons), equivalent to approximately 1.6-weeks current production. Inventory was 0.7 percent lower compared to September 30th 2019. During the period September 29th 2019 through November 2nd 2019, dried egg processed under USDA inspection amounted to 13.45 million lbs. Lower shell-egg prices during the past three months diverted non-contracted eggs from packing to breaking.

The October 31st total dried egg inventory comprised whole egg (43.9%); albumen (22.8%); yolk (31.2%) and blends (2.0%).

COMMENTS

Newcastle Disease

The incidence rate of Newcastle disease in Southern California declined over the past three months and no cases were diagnosed for eight consecutive weeks. A case was reported from a feed store on August 14 th followed by a spontaneous case in a vaccine-production flock in San Diego County on August 31st and then in a backyard flock on September 9th. Two new cases were diagnosed on adjacent backyard farms in San Bernardino County on November 14th and 20 th with an additional case in a feed supply store also on November 20th. To declare the 2018 - 2019 outbreak officially over will require 13 weeks from depletion of the last diagnosed case. Given experience with Newcastle disease in small flocks in a given area it is inevitable that incident cases will emerge from either introduction from Mexico or extension from unrecognized reservoirs in California. Investigation of the current incident cases is in progress and it is hoped that greater transparency and disclosure will be forthcoming than in past months. The progress of the outbreak was as follows:-

A total of 454 exotic velogenic viscerotropic Newcastle disease (vvND = END) cases in small multi-species backyard flocks mainly comprising gamefowl (fighting cocks) were confirmed between May 18th and November 22nd in the Southern California Counties of San Bernardino (146), Riverside (260), Los Angeles (45), Ventura (1), (San Diego (1) and Alameda (1). Pre-emptive slaughter of all "birds" (presumed to be domestic galliformes and some anseriforms) in four communities in Los Angeles, Riverside and San Bernardino Counties was conducted under the direction of the State Veterinarian for California in November 2018. This probably resulted in dissemination of infection by owners moving birds. A case of vvND was diagnosed in a flock of non-commercial chickens, presumed to be fighting cocks in Utah County, UT on January 18th.

A surge of incident cases was detected in Riverside County during mid-December 2018 with 43 incident cases diagnosed during the month. There were 86 new cases in January 2019, 48 in February, 22 during March, 17 in April, 20 in May and 1 in early June. In late March the USDA released funds from the 2015 HPAI outbreak but this may be characterized as too-little and too-late after 13 months. The decline in incidence rate is less attributed to the "control procedures" carried out by APHIS/CDFA than to immunity developing in flocks from vaccination and exposure of vaccinated flocks that will remain non-clinically affected reservoirs shedding virus in a cycle of exposure. Clearly many flocks are not identified or diagnosed given the relationship of owners of fighting cocks to federal and state agencies.

The END situation has not disrupted exports of raw poultry, breeding stock, hatching or table eggs or egg products to Mexico. Following negotiations after the index case of END was diagnosed in Los Angeles County during mid-May 2018, authorities in Mexico accepted regionalization and on May 23 rd restored importation of raw poultry from other than the restricted Counties in California. There is absolutely no reason to embargo pasteurized egg products derived from a USDA-FSIS inspected plant.

Avian Influenza

In the U.S. and the E.U. reassortant strains of avian influenza virus are introduced into regions beneath flyways by migratory birds and then transmitted to backyard and commercial free-range flocks or to confined flocks by deficiencies in biosecurity. Incident cases in the E.U., Asia and North Africa during 2018 should be a warning to U.S. producers during the fall and early winter of 2019 since the risk of infection necessitates enhanced biosecurity and effective containment.

There is a presumption that migratory waterfowl cease shedding AI virus by the first week of April, re-commencing in December. Accordingly, incresased biosecurity is required under the Pacific, Central and Mississippi flyways. Flocks allowed outside access during periods when migratory birds are shedding virus are vulnerable to infection.