Egg Industry Statistics and Reports


USDA-WASDE REPORT #648, May 10th 2024

05/10/2024

OVERVIEW

 

The USDA provided updated projections for the production of corn and soybeans in the May 11th World Agriculture Supply and Demand Estimates (WASDE) #648, reflecting the anticipated 2024 crop. Values were understandably changed from the April edition given the initiation of planting. P rojections are based on acreage, yield, carry-forward levels from 2023, and with the latest assumptions of domestic use and exports giving rise to ending stocks.

 

The May 10th WASDE report predicted that corn would be harvested from 82.1 million acres, down 4.4 percent from the April projection. The soybean crop will be harvested from 85.6 million acres, up 3.7 percent from the previous monthly report.

 

The May WASDE increased the yield value for the 2024 corn crop by 2.0 percent to 181.0 bushels per acre. By comparison yield was 174.9 bushels per acre in 2023. The soybean yield was raised 2.8 percent to 52.0 bushels per acre compared to 49.9 bushels per acre in 2023.

 

The May 2024 USDA projection for the ending stocks of corn was 2,102 million bushels, down 2.3 percent from 2,152 million bushels in the April WASDE. The May 2024 USDA projection for the ending stock of soybeans was 445 million bushels, up 30.8 percent from 340 million bushels in April.

 

The May 2024 WASDE lowered the ex-farm price of corn by 6.4 percent or 30 cents per bushel to 440 cents per bushel. The projected average season price for soybeans was reduced by 10.8 percent or 135 cents per bushel to 1,120 cents per bushel. Soybean Meal was projected 13.2 percent lower or $50 per ton to $330 per ton. These reductions suggest lower feed prices for livestock and poultry producers but lower income for farmers contributing to Congressional impasse over the delayed Farm Bill.

 

Projections for world production included in the May 2024 WASDE report reflect the most recent estimates for the production and export of commodities in the Southern Hemisphere with an emphasis on Argentine and Brazil. Economists also evaluated the likely impacts from hostilities in Ukraine with occupation of ten percent of the Nation’s land area by the Russian Federation and following extensive destruction of agricultural infrastructure. It is evident that production and hence exports of wheat, corn and sunflower from Ukraine will be reduced compared to pre-war averages. These adversities have been partly overcome by aggressive naval action allowing the “Humanitarian Corridor” that traverses the national waters of friendly countries along the western Black Sea coast.

 

It is accepted that USDA projections for export are also based on the perceived intentions and needs of China. This Nation has sharply curtailed purchases of commodities and especially U.S. soybeans during the current market year despite drought and taking into effect relaxation of COVID restrictions on consumers with higher demand.

 

Reports on volumes of commodities exported are included in weekly editions of EGG-NEWS, derived from published USDA-FAS sales data. Weekly Crop Progress reports will be posted through late November

 

CORN

Based on increased yield and lower acreage projections for the 2024 corn harvest, the May WASDE Report predicts a crop of 14,860 million bushels compared to 15,234 million bushels for the previous 2023 record harvest. The “Feed and Residual” category was increased from April to 5,750 million bushels. The Food and Seed category was retained at 1,405 million bushels. The “Ethanol and Byproducts” Category was raised 0.9 percent to 5,450 million bushels consistent with estimated demand for E-10 and higher blends. Gasoline consumption is now less restrained despite high prices and changes in commuting patterns reflecting a recovery from COVID restrictions. Projected corn exports were raised 4.8 percent to 2,200 million bushels, based on recent orders, and ongoing shipments to China and taking into account the anticipated lower availability of coarse grains from Eastern Europe. Exports of U.S. corn are 29.9 percent higher during the current market year to date compared to the corresponding week in the previous market year. The USDA considers world weather patterns in developing projections including the effect of a transition to a La Nina event by the third quarter of 2024. Anticipated ending stocks of corn in the May WASDE report were down 0.9 percent to 2,102 million bushels.

 

The forecast USDA average season farm price for corn in the May WASDE report covering the 2024 crop was reduced 30 cents to 440 cents per bushel. At 16H00 on May 10th after the noon release of the WASDE the CME spot price for corn was 468 cents per bushel, up 9.3 percent from the quotation on April 11th and up 6.0 percent from the May USDA projection.

 

MAY 2024 WASDE #648 Projections For The 2024 Corn Harvest:

 

Harvest Area

82.1 m acres (5.1% lower than April 2023)

(90.0 m. acres planted), harvest corresponding to 91.2% of acres planted)

 

Yield

181.0 bushels per acre

(Updated from 1773 bushels per acre in the April WASDE.)

 

Beginning Stocks

 

  2,022 m. bushels

Up 50.7% from April WASDE

 

Production

 

14,860 m. bushels

 

 

Imports

 

       25 m. bushels

 

 

Total Supply

 

16,907 m. bushels

Proportion of Supply

 

Feed & Residual

 

  5,750 m. bushels

 

34.1%

 

Food & Seed

 

  1,405 m bushels

 

 8.3%

 

Ethanol & Byproducts

 

  5,450 m. bushels

 

32.2%

 

Domestic Use

 

12,605 m. bushels

 

74.6%

 

Exports

 

  2,200 m. bushels

 

13.0%

 

Ending Stocks

 

  2,102 m. bushels

                               12.7 %

Down 0.9% from 2,122 m bushels in the April WASDE

1 metric ton = 39.368 bushels

Average Farm Price: 440 cents per bushel. (Down 30 cents per bushel from from the April WASDE Report reflecting the 2024 projected crop)

 

SOYBEANS

Based on a prediction of increased acreage to be planted and adjusted yield, the USDA May WASDE projected the 2024 soybean crop at 4,450 million bushels with an estimated yield of 52.0 bushels per acre from 85.6 million acres harvested. Crush volume was raised 5.4 from the April WASDE report to 2,425 million bushels. Projected exports were raised 7.4 percent to 1,825 million bushels despite reduced exports to China. Shipments for the current market year are down 18.4 percent from the corresponding week of the previous market year. Ending stocks were anticipated to be 445 million bushels, up 30.9 percent from the April WASDE report.

 

There is uncertainty over orders from China for the current market year. This is attributed to competition from Brazil and an assumption of lower requirements for animal feed due to restrictions on pork production by the Central Government. In reality traders in China are obligated to order on a stable or declining market unless faced with shortages. Prior to 2018, China, the largest trading partner for U.S. agricultural commodities, imported the equivalent of 25 percent of U.S. soybeans harvested.

 

The USDA May 2024 projection for the ex-farm price for soybeans for the 2024 harvest was down 135 cents per bushel from the April WASDE report to 1,120 cents per bushel. At 16H00 on May 10th following release of the WASDE, the CME spot price was 1,219 cents per bushel, down 5.3 percent compared to the April 11th quotation and 8.8 percent above the May USDA projection.

 

MAY 2024 WASDE #648 PROJECTION FOR THE 2024 SOYBEAN HARVEST:-

 

Harvest Area

85.6 m acres (Up 3.9% from April 2023 WASDE)

86.5 m. acres planted. Harvest corresponding to 99.0% of planted acreage)

 

Yield

52.0 bushels per acre

(Updated from 50.6 bushels per acre in the April WASDE)

 

Beginning Stocks

 

    340 m. bushels

(Up 25.8% from the April WASDE for the 2024 crop)

 

Production

 

  4,450 m. bushels

 

 

Imports

 

       15 m. bushels

 

 

Total Supply

 

  4,805 m. bushels

Proportion of Supply

 

Crush Volume

 

  2,425 m. bushels

 

50.4%

 

Exports

 

  1,825 m. bushels

 

38.0%

 

Seed

 

       78 m. bushels

 

 1.6%

 

Residual

 

        32 m. bushels

 

 0.7%

 

Total Use

 

  4,360 m. bushels

 

90.7%

 

Ending Stocks

 

     445 m. bushels

                                  9.3%

           (up 30.9% from the April WASDE )

1 metric ton = 36.74 bushels

Average Farm Price: 1,120 cents per bushel (Down 135 cents per bushel from the April 2024 WASDE Report)

 

SOYBEAN MEAL

The projected production of soybean meal from the 2024 soybean crop will be 57.08 million tons. This was up 5.2 from the April WASDE and consistent with a 5.4 percent increase in crush volume for soybeans to 2,425 million bushels. This figure is also corresponds with increased demand for biodiesel and with a proportional increase in U.S. crushing capacity. Production is driven both by exports and domestic consumption for livestock feed and for soy oil supplying the food and biodiesel segments. The projection of domestic use was raised 3.3 percent to 40.32 million tons. Exports were raised 9.5 percent to17.3 million tons.

 

The USDA lowered the ex plant price of soybean meal to $330 per ton as an average for the season based on supply and demand considerations as reflected in a raised ending stock of 450,000 tons representing 0.8 percent of supply.

 

At 16H00 on May 10th the CME spot price for soybean meal was $373 per ton, up 11.0 percent compared to the April 11th CME quotation and $43 per ton or 13.0 percent higher than the  WASDE projection of $380 per ton.

 

MAY 2024 WASDE #648 PROJECTION OF SOYBEAN MEAL PRODUCTION AND USE

Beginning Stocks

     400

Production

57,075

Imports

     600

Total Supply

58,075

Domestic Use

40,325

Exports

17,300

Total Use

57,625

Ending Stocks

     450

(Quantities in thousand short tons)

 

Average Price ex plant:  $330 per ton (Down $50 per ton from the April WASDE Report)  

 

IMPLICATIONS FOR PRODUCTION COST

The price projections based on CME quotations for corn and soybeans suggest lower feed production costs for broilers and eggs.  Going forward, prices of commodities will be determined by World supply and demand and U.S. domestic yield, use and exports.

 

For each 10 cents per bushel change in corn:-

  • The cost of egg production would change by 0.45 cent per dozen
  • The cost of broiler production would change by 0.25 cent per live pound

      For each $10 per ton change in the cost of soybean meal:-

  • The cost of egg production would change by 0.35 cent per doze
  • The cost of broiler production would change by 0.30 cent per live pound.

 

WORLD SITUATION

With respect to world coarse grains and oilseeds the February 2024 WASDE Report included the following appraisals by USDA:-

 

COARSE GRAINS:

“The 2024/25 global coarse grain outlook is for record production and use, and fractionally lower ending stocks. World corn production is forecast to decline from the prior year’s record to 1.220 billion metric tons, with the largest declines for the United States, Ukraine, Zambia, Argentina, Malawi, Mozambique, and Turkey. Partly offsetting are larger crops projected for Brazil, the EU, China, South Africa, and Mexico. Lower area expectations drive a decline in corn production for Argentina, in contrast to Brazil where production is forecast higher on expanded area. Ukraine corn production is expected to be down on reductions to both area and yield. Corn crop prospects for Russia are down as higher area is more than offset by a decline in yield. World barley, sorghum, oats, millet, mixed grain, and rye production are all forecast higher than a year ago”.

 

“World corn use is expected to rise less than 1 percent to a record 1.221 billion metric tons, with foreign consumption increasing modestly. World corn imports are forecast to fall just under 1 percent, driven by declines for several countries, including the EU, Canada, Iraq, and Venezuela. Partly offsetting are increases for Mexico, Saudi Arabia, Vietnam, Egypt, and Iran.

 

Global corn ending stocks for 2024/25 are down 0.8 million tons to 312.3 million. Stocks in the major exporting countries of Argentina, Brazil, Russia, Ukraine, and the United States are projected down slightly, reflecting higher stocks in the United States mostly offset by declines for Brazil and Ukraine”.

 

“For China, total coarse grain imports for 2024/25 are forecast at 41.5 million tons, up marginally from a year ago. Despite lower internal market prices for energy feedstuffs, expectations are for China’s prices to remain higher than the world market. Corn imports are projected unchanged at 23.0 million tons, barley imports are down 0.2 million to 10.0 million, and sorghum is up 0.5 million to 8.0 million”.

 

OILSEEDS:

“The 2024/25 global oilseed outlook shows higher production, crush, exports, and ending stocks compared with 2023/24. Global production is rising 28.9 million tons to 687.1 million mainly on higher soybean production for South America, the United States, and South Africa. Brazil’s soybean production is forecast at 169.0 million tons, up from the revised 2023/24 crop of 154.0 million, which was reduced due to flooding in Rio Grande do Sul. Argentina’s soybean output is forecast at 51.0 million tons for 2024/25. Global production of high-oil content seeds (rapeseed and sunflower seed) is nearly flat compared to the prior year as higher sunflower seed production for the EU and rapeseed production for Canada and Australia is mostly offset by lower rapeseed production for the EU, Ukraine, India, and the UK”.

 

“Global 2024/25 oilseed crush is growing 17.3 million tons to 560.8 million from 2023/24, with most of the growth for soybeans (15.9 million) mainly for Argentina, China, Pakistan, and the United States. Global sunflower seed and rapeseed crush is flat on stable available supplies. Soybean meal exports account for the majority of meal export growth. Lower year-over-year exports of sunflower seed oil and rapeseed oil are mostly offset by growth in soybean, palm, and palm kernel oil shipments”.

 

“Global soybean exports for 2024/25 are increasing 4 percent from last marketing year mainly on higher soybean exports for the United States, Brazil, Argentina, and Ukraine. Soybean imports are higher for China, Pakistan, Egypt, Mexico, Iran, and Vietnam. China’s soybean imports are rising 4.0 million tons to 109.0 million on larger global supplies and lower prices. Global 2024/25 soybean ending stocks are projected up 16.7 million tons to 128.5 million, with most of the increase for Brazil, Argentina, the United States, and China”.

 

Factor: Million m. tons

Coarse Grains

Oilseeds

Output

  1,512*

687

Supply

1,852

816

World Trade

          233

207

Use

1,513

561

Ending Stocks

          340

     145

 

*Values rounded to one million metric ton

  (1 metric ton corn= 39.37 bushels)  (“ton” represents 2,000 pounds)


 

Commodity Report

05/09/2024

WEEKLY ECONOMY, ENERGY AND COMMODITY REPORT: MAY 9th 2024.

 

OVERVIEW

 

Prices for corn and soybeans diverged this week. Corn was down 1.1 percent but soybeans and soybean meal were up 0.8 and 4.2 percent respectively compared to last week. Prices were influenced by technical selling arising from geopolitical concerns and revised projections for crop sizes in Brazil and Argentine. Secondary factors included disruption in shipping in the Red Sea and Panama Canal, carryover from the 2023 U.S. crop, export orders and the predicted ending stocks of corn and soybeans for the 2024 crop. The May WASDE Report will update production forecasts and prices based on planting approaching the midway mark, and the transition to a La Nina by mid-year.

 

At noon EDT on May 9th the CME price for corn was down 1.1 percent compared to the previous week to 442 cents per bushel for May delivery. Corn price was influenced by ethanol demand and the proportionally high ending stock from the 2023 crop. Export orders for the current market year have increased in response to lower prices. Volumes and prices are indirectly influenced by higher wheat prices, events in the Black and Red Seas. Orders by China resumed at the end of the 2022-2023 market-year and have extended through March despite a higher Dollar Index offset by a low FOB prices although with increased ocean freight. Total exports for the current market year are 29.9 percent higher than for the corresponding week during the 2022-2023 year.

 

Soybeans traded at 1,197 cents per bushel for May 2024 delivery, up 0.8 percent over the week. Slightly higher prices were attributed to trading, less farm selling and projections of availability from the 2024 Brazil and Argentine harvests. Total exports for the current market year are 18.4 percent lower than for the corresponding week in the 2022-2023 year.

 

Soybean meal traded at $368 per ton for May delivery, up 4.2 percent compared to $353 per ton for last week. Price was influenced by demand coupled with high crush volumes for consecutive months from December 2023 onwards resulting from increased capacity. Price will fluctuate to reflect the CME price for soybeans and the demand for biodiesel despite the adverse financial situation in this sector. The market previously responded to the increased 2023 crop and higher stocks together with projections for 2024 unchanged from March in the April WASDE Report to be revised in the May release.

 

 WTI was $4.55 (-5.5 percent) lower from last week to $77.75 on May 8th with moderate to lower world demand in relation to supply. Price is down partly due to a lull in the attacks on shipping in the Red Sea, and cessation of hostilities between Israel and Iran. It is accepted that U.S. production is a moderating influence, attaining 12.9 million barrels per day in March with ample reserves. An upward trajectory in price may occur if production cuts by OPEC amounting to 2 million barrels per day and extended through June actually materialize. There was a downward move in price during the week ($81.06 to $77.75 range). Crude oil inventory in the U.S., other than the Strategic Reserve, was up 6.5 percent to 35.3 million barrels last week. High U.S. production is constraining domestic and international prices but the rise in energy cost during past weeks is reflected in inflation restraining the FOMC from lowering the benchmark interest rate.

 

Economic data released during the past week (Q1 GDP; PCE, Confidence, Productivity, Employment) confirmed slower growth and persistent inflation.

The data-driven Federal Reserve FOMC passed on a lowering of rates on May 1st and will be disinclined to reduce the benchmark interest rate until September at the earliest.

 

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 and also Argentine with favorable rain recently under the influence of a strong El Nino The 2023 U.S. harvest was completed ahead of the corresponding weeks in 2022 with higher carryover and lower exports of soybeans. (Downward pressure on prices). Planting is almost complete for the “new” crop of 2024 but has been disrupted by flooding in the southern production states.
  • Geopolitical considerations continue to move markets, especially in the Mideast. Ongoing attacks on Ukraine port facilities have impacted prices of wheat, corn, oilseeds and vegetable oils. Loaded bulk vessels are sailing from Black Sea and Danube River ports using the ‘Humanitarian Corridor” to various destinations. This route is operational despite threats by the Russian Federation to mine the entrance to ports and deployment of airborne missiles. Exports from Ukraine are approaching 1.5 million metric tons per week with a total of 26 million metric tons market year through February, down 11 percent from the equivalent period for 2022-2023 year. Grain production in Ukraine during the current year will be lower than 2022/2023 (Downward pressure on corn and wheat and an indirect effect on soybeans)
  • Macroeconomic U.S. factors:-
  • Most economists in academia and the private sector are still confident of a “soft landing” for the economy despite the release of the Q1 2024 GDP and recent economic parameters including the ECI, CPI and PPI and with fluctuation in bond rates. Annual inflation as measured by CPI declined from 8.9 percent in June 2022 to 3.5 percent in March 2024. This is in part a response to a series of 11 FOMC rate raises that curbed inflation and cooled the labor market but without precipitating unemployment. There is evident stability in the bank sectors in both the U.S. and Europe. A rise in energy prices is contributing to persistence of inflation.
  • The Federal Reserve held the benchmark interest rate steady at the monthly FOMC meeting on May 1st 2024, the sixth sequential pause. The Federal Reserve commentary indicated that the rate would be held at 5.25 percent until a pivot with possibly less than two reductions of 25 basis points each in 2024, after the September meeting at the earliest. Chairman Powell in Congressional testimony and documented in FOMC minutes has indicated that decisions would be based on demonstrated progress in reducing inflation as confirmed by a basket of key economic data, towards an annual 2.0 percent target by mid-2025. Market optimism with projections of five reductions during 2024 was evidently premature.
  • The March 28th Bureau of Economic Affairs released the advanced estimate of Q1 2024 GDP at 1.6 percent, below the consensus estimate of 2.4 percent. The Q1 GDP value was influenced by spending by both consumer and government-sectors and with higher investment in housing. By comparison Q4 2023 GDP growth was 3.4 percent. Growth in GDP attained 2.5 percent in 2023 up from 1.9 percent in 2022. The Q1 Personal Consumption and Expenditure Index For Q1 (excluding food and energy) was up 3.7 percent annualized, higher than 2.0 percent in Q4 2023.
  • The April 26th Bureau of Economic Analysis released the March Personal Consumption and Expenditure Price Index. The core index (excluding food and energy) was up 0.8 percent from the previous month and 2.8 percent year-over-year. This was in line with estimates. The Headline PCE Index was up 2.7 percent year-over-year, above an estimate of 2.6 percent. On an annual basis the price of goods was unchanged, services were up by 4.0 percent, food by 1.5 percent and energy by 2.6 percent. The headline PCE is closely followed by the Federal Reserve and confirms persistent inflation holding above an annual target of 2.0 percent.
  • The April 10th Bureau of Labor Statistics release of the March 2024 CPI confirmed a 0.4 percent increase from February, and 0.1 percent above forecast. The annual increase of 3.5 percent was up from 3.2 percent in February and higher than the anticipated value. The increase in the core value (excluding food and energy) was 0.4 percent from February and 3.8 percent for the 12-month period, and estimates. Food at home was unchanged from the previous month. The category of ‘meat, fish and poultry’ was up collectively by 0.9 percent with eggs up 4.6 percent from the previous month. Food away from home was up 0.3 percent from February. On an annual basis all food was up 2.2 percent with food at home up 1.2 percent and food away from home up 4.2 percent. Energy was up 1.1 percent together with natural gas (-3.2 percent) in March. The shelter category was up 0.4 percent for the month and 5.7 percent over the past year. The macro trend is inclining towards reduced inflation due to a fall in energy prices but this category has recently moved up, detracting from deflation. The CPI heavily influences FOMC rate decisions.
  • The March Producer Price Index for Final Demand (PPI) released on April 11th was up by 0.2 percent from February compared to an expectation of 0.3 percent. The PPI was up 2.1 percent over the past 12-months. This is compared to a 6.4 percent increase in 2022. The core PPI value excluding volatile fuel and food, was up 0.2 percent for March and up 2.8 percent for the 12-month period. Food was up 0.8 percent compared to a 1.1 percent increase in February.
  • A Federal Reserve release on April 16th confirmed that industrial production rose 0.4 percent in March. Capacity utilization was fractionally higher at 78.4 percent, 1.2 percent below the 1972-2020 average.
  • The April 24th report on Durable Goods Ordered during March 2024 was higher by 2.6 percent to $283 Billion compared to a revised value of 0.7 percent or $376 Billion in February. Transportation and specifically aircraft orders were up 7.7 percent. Excluding the Transportation component, new orders increased by 0.2 percent in March compared to February. Shipments of durable goods were essentially unchanged from February that in turn was up 1.2 percent from January 2024 impacted by severe weather.
  • The April 15th release of retail sales data showed a monthly rise of 0.7 percent in March. This value is compared to the revised 0.9 percent rise in February 2024, reflecting a rebound from depressed sales in January affected by harsh winter storms and a change in the basis of calculation. Retail sales in March 2024 were up 4.0 percent from the corresponding month in 2023. The Federal Reserve FOMC closely monitors retail sales as a measure of the trend in inflation.
  • The May 1st release by the Institute for Supply Management (ISM®) documented the Manufacturing Index for April at 49.2 down from 50.3 in March and below the consensus of 50.0. New orders fell to 49.1 (54.6, March) and Production attained 51.3 (54.6 March).
  • On April 30th the U.S. Bureau of Labor Statistics reported a 1.2 percent increase in the Employment Cost Index (ECI) over the 1st quarter of 2024 against a consensus estimate of 0.9 percent. The year-over-year increase was 4.4 percent compared to an estimate of 4.0 percent and with benefit costs up by 3.7 percent. The March ECI of 1.2 percent compares with a value of 0.9 percent for the 4th quarter of 2023. The ECI is closely followed by the Federal Reserve FOMC and further reduces the possibility of a rate cut before September at the earliest.
  • The April 23rd release of the S&P Global Composite U.S. Manufacturing PMI for April fell to 50.9 compared to revised 52.1 in March. The Global Services PMI fell from 51.7 in March to 51.7 in April.
  • The Conference Board Consumer Confidence Index released on April 30th for April, fell to 97.0 points from a revised 103.1 for the preceding four-week period. The index was lower than a consensus estimate of 104.0. The Present Situation Index was down to 142.9 in April compared to 157 in March. The Expectations Index fell to 66.4 in April from a revised 74.0 in March. Values below 80.0 suggest a future recession
  • The April 26th University of Michigan Final Index of Consumer Sentiment fell 2.2 points to 77.2 for April down from a revised final value of 79.4 in March. The Index was up 22.2 percent from April 2023. Both the Current Economic Index (76.0 down from 82.5 in March) and the Index of Consumer Expectations (76.0 down from 77.4 in March) denote a decline in consumer sentiment influenced by stable but high interest rates and inflation despite geopolitical concerns. Inflation expectations 12-months hence moved higher from 3.1 to 3.2 percent among those surveyed.
  • Non-farm payrolls added 175,000 in April, as documented by the Bureau of Labor Statistics in a May 3rd This was less than the anticipated 240,000, and should be compared to the revised March value of 315,000. The moderate increase was attributed to workers hired in the health care and government sectors. The unemployment rate rose to 3.9 percent with 6.5 million unemployed and with 1.3 million in the long-term category. Real average hourly earnings during April showed a 0.2 percent increase over March to $34.75 . Average hours worked fell 0.1 percent to 34.7 per week in April. Labor participation was unchanged at 62.7 percent in April. Wage rates increased 3.9 percent over 12-months, the lowest gain since June 2021. Wage rates are closely followed by the Federal Reserve FOMC.
  • The Bureau of Labor Statistics Job Openings and Labor Survey report released on April 2nd estimated 8.8 million job openings at the end of February, down 100,000 (-0.1 percent) from January 2024 and consistent with estimates. The February job openings number was the lowest value in 34 months and compares with the March 2022 value of 12.2 million during COVID.
  • The seasonally adjusted initial jobless claims figure of 231,000 released on May 9th was the highest in eight months and was up 22,000 from the revised seasonally adjusted value for the week ending May 2nd. The Weekly value was unexpectedly higher than the Reuter’s estimate of 215,000. The four-week moving average declined to 215,000 The Bureau of Labor Statistics estimated 1.785 million continuing claims for the week ending April 27th There is evidence from data over the past three months that the labor market is cooling but still tight despite sporadic weekly fluctuation in new claims.
  • The May 2nd Bureau of Labor Statistics report recorded a 0.3 percent increase in non-Farm Productivity for Q1 2024 down from 0.7 percent in Q4 2023. Labor cost increased 4.7 percent over the past 12 months.
  • The ADP® reported on May 1st that private payrolls increased by 192,000 in April, down 16,000 from the revised 208,000 in March and compared to the Dow Jones estimate of 183,000 jobs. The increase in employment was mostly in the construction, services and hospitality sectors. Annual pay was up 5.0 percent year-over-year, down from 5.1 percent in March and the lowest value since August 2021. 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


 


Egg Exports

05/05/2024

Export of Shell Eggs and Products, January-March 2024.

 

The volume of exports of shell eggs are conditioned by the domestic needs of importers, price against competitors and disease and logistic restraints. This is demonstrated by the 182 percent drop in volume of shell egg exports from 2012 (198 million dozen) to 2022 (70 million dozen). Due to depletion of flocks in 2023, export prices increased 113 percent from $1.02 per dozen to $2.16 per dozen reflecting domestic prices. Depressed exports persisted in 2023 with 90 million dozen shell eggs exported at an average price of $1.80 per dozen as losses from HPAI rose in the last quarter with a consequential rise in domestic price.

 

It is questioned whether lost markets other than the USMCA and Caribbean nations will be reclaimed over the intermediate term. Sporadic and short-term exports may be made to various nations based on supply disruption caused by HPAI or other factors.

 

USDA-FAS data collated by USAPEEC, reflecting export volume and values for shell eggs and egg products are shown in the table below comparing 2024 with 2023:-

 

PRODUCT

Jan.-March 2023

Jan.-March 2024

Difference

Shell Eggs

     

Volume (m. dozen)

20.3

21.8

+1.6 (+7.8%)

Value ($ million)

60.6

43.4

 -17.2 (-28.3%)

Unit Value ($/dozen)

2.89

1.99

 -0.90 (-31.1%)

Egg Products

     

Volume (metric tons)

7,523

7,369

 -154 (-2.0%)

Value ($ million)

35.5

35.1

-0.4 (-1.1%)

Unit Value ($/metric ton)

4,719

4,763

-44 (-0.9%)

 

U.S. EXPORTS OF SHELL EGG AND EGG PRODUCTS DURING

JANUARY-MARCH 2024 COMPARED WITH 2023

 

SHELL EGGS

Shell egg exports from the U.S. during the fist quarter of 2024 increased by 7.8 percent in volume but declined 28.3 percent in total value compared to the corresponding months in 2023. Unit value declined 31.1 percent to $1.99 per dozen compared to the corresponding quarter in 2023.

 

Canada was the leading importer of shell eggs during January-March 2024, with 16.0 million dozen representing 73.4 percent of volume and 71.0 percent of the $43.4 million total value of U.S. shipments of shell eggs. Unit price over January-March 2024 was $1.93 per dozen compared to $3.25 per dozen for consignments in January-March 2023. Imports by Canada are driven by consumer demand balanced against availability through the controlled supply situation. This inhibits flexibility, necessitating imports from the U.S. to cater for demand especially when additional losses occur due to HPAI. During March 2024 Canada imported 7.9 million dozen up 9.7 percent over the corresponding month in 2023. Value was down 40.2 percent to $15.2 million but unit value was 45.2 percent lower to $1.92 per dozen.

 

The Caribbean Region (Bahamas, Netherlands Antilles, Cayman Islands) was a distant second in shell egg imports from the U.S. during January-March 2024, with 2.5 million dozen representing 11.5 percent of volume and 11.5 percent of the total value of U.S. shipments of shell eggs. Unit price in January-March 2024 was $2.00 per dozen

 

Mexico was the third-ranked importer of shell eggs in January-March 2024 with a volume of 0.6 million dozen representing 2.8 percent of export volume and 2.3 percent of value. Unit value of $1.67 per dozen compared to an average value of $1.99 per dozen for all exports. During March Mexico imported 0.1 million dozen valued at $0.2 million.

The average 12-month trailing USDA benchmark price for nest-run large shell eggs was $1.56* per dozen weighted by high prices caused by shortages during the first quarter of 2023 resulting from depletion of flocks infected with HPAI.

 

*USDA 12-month USDA benchmark nest-run unit prices per dozen: $2.74; April, $1.38; May, $0.60; June, $0.82; July, $0.83 and August, $0.90; September, $1.00; October, $0.89; November, $1.65; December, $1.81; January 2024, $1.72; February, $2.51 and March, $1.87.

 

EGG PRODUCTS

The total volume of exported egg products during January-March 2024 decreased 2.0 percent to 7,369 metric tons compared to January-March 2023. Total value of $35.1 million was lower by 1.1 percent compared to January-March 2023. Unit value decreased by 0.9 percent to $4,763 per ton compared to January-March 2023. During 2023 the U.S. exported 29,814 metric tons of egg products valued at $134.3 million with a unit price of $4,505 per metric ton. Fluctuation in unit price reflects the composition of exports and the relationship between World supply and demand. Ukraine is now restrained in production but India continues as a significant exporter.

 

Japan was the 1st-ranked importer by volume of egg products during January-March 2024 receiving 1,788 metric tons from the U.S. valued at $8.7 million representing 24.3 percent of volume and 24.8 percent of value with a unit price of $4,865 per metric ton. Volume for January-March 2024 was down by 22.2 percent and value was lower by 27.5 percent compared to January-March 2023. During March 2024 Japan imported 651 metric tons down 29.5 percent over the corresponding month in 2023. Value was down 42.0 percent to $2.9 million and unit value was 17.8 percent lower to $4,455 per metric ton. During 2023 Japan imported 10,352 metric tons of egg products from the U.S., valued at $49.9 million. With the conclusion of a bilateral trade agreement, the U.S. is no longer at a competitive disadvantage with respect to the E.U.

 

Mexico was the 2nd ranked importer from the U.S. during January-March 2024 based on a volume of 1,538 metric tons with a value of $5.5 million, representing 20.9 percent of volume and 15.7 percent of the total value of U.S. exports of egg products. Exports to Mexico were up by 25.0 percent in volume but 17.9 percent lower in value compared to January-March 2023. The unit value of $3,576 per metric ton can be compared with the average unit value for U.S. exports of all egg products at $4,763 per metric ton. During March, Mexico imported 506 metric tons valued at $1.5 million. Volume was 77.5 percent higher and value was 28.5 percent lower than in March 2023.

 

Canada was the 3rd-ranked importer in January-March 2024 based on a volume of 1,185 metric tons with a value of $4.3 million. Canada represented 16.1 percent of volume and 12.3 percent of value with a unit price of $3,628 per metric ton. During March Canada was 3rd- ranked with 442 metric tons representing 17.7 percent of exports of egg products but down 79.1 percent from March 2023. Value was $1.6 million or 14.9 percent of the monthly total, down 33.3 percent from March 2023 due to a 218 percent increase in unit revenue to $3,619 per metric ton, reflecting a change in proportions of egg products consigned. Volumes shipped reflect restoration of the institutional and food service sectors and the relative availability of domestic product in Canada.

 

South Korea was ranked fourth among importers of egg products during January-March 2024 with a volume of 759 metric tons valued at $3.0 million with a unit value of $3,952 per metric ton. Comparing these values with January-March 2023, volume was 129 percent higher and value was up by 57.9 percent. Most flocks in South Korea have been restored to production after depopulation following 2022 outbreaks of HPAI. Import volume may have been influenced by recent limited but rising flock depletion or alternatively the need to replenish stocks after the Lunar New Year. In 2023 South Korea imported 1,141 metric tons valued at $5.3 million. Depending on severity, the return of HPAI may result in a disparity between local availability and demand requiring imports in 2024 as in 2022.

 

The E.U.-27 continues as an importer of egg products with 698 metric tons valued at $7.4 million with a unit price of $1,060 per metric ton.

 

Australia has emerged as an importer of egg products with 349 metric tons shipped during the first quarter of 2024 valued at 1.2 million with a unit price of $3,077 per metric ton.

 

COMMENTS

Exports to Canada and Mexico combined in 2022 amounted to $126.5 million in value equivalent to 47.5 percent of the total value of shell eggs and products shipped. During 2023 exports valued at $150.7 million represented 50.8 percent of shell egg and egg products amounting to $296.5 million. Canada represented 59.0 percent of the $162.2 million for shell eggs and 10.3 percent of egg products valued at $121.2 million, consigned during 2023, emphasizing dependence on this USMCA partner. During January-March 2024 the USMCA represented 52.9 percent of combined shell egg and product sales valued at $78.5 million.

 

Aspirational volumes of exports in excess of five percent of domestic production are unrealistic. The E.U., Japan, South Korea and Taiwan will buy according to their needs for undifferentiated shell eggs and products based on landed price in a competitive World market. Purchase decisions for commodities are determined by FOB price, freight, duty and broker margins. Shell eggs and the various categories of egg products are essentially commodities and generally do not respond to promotion.

 

Exports will be dependent on the willingness of importers to accept the World Organization for Animal Health (WOAH) principle of regionalization (zoning) in the event of outbreaks of exotic Newcastle disease or isolation of either H5 or H7 avian influenza (AI), in commercial flocks, irrespective of pathogenicity. Most importing nations are now applying regionalization and permitting imports on a zonal, county or state-exclusion basis following H5 or H7 AI infection. Canada and the U.S. operate according to a 2018 bilateral agreement to maintain trade in the event of outbreaks of catastrophic exotic diseases including HPAI and END.

 

Generally pasteurized egg products should not be subject to any embargo imposed following reports of AI or Newcastle disease in a region.


 

Egg Week

05/01/2024

USDA Weekly Egg Price and Inventory Report, May 1st 2024.

 

Market Overview

 

  • The average wholesale unit revenue values for Midwest Extra-large and Large sizes were down 16.2 percent this past week. Medium size was down 16.5 percent. National wholesale price for large in cartons at $2.50 per dozen was approximately $0.95 per dozen above the 3-year average of $1.55 per dozen and up $1.05 from the corresponding week in 2023 at $1.45 per dozen. This past week shell egg inventory was up by 0.8 percent, moderating a rise of 1.5 percent in stock the previous week.
  • Although there has been a weekly increase in pullet flocks transferred to laying houses, hen numbers are constrained by the loss of close to 13 million hens due to HPAI on twelve complexes holding from 250,000 to 2.6 million hens during the 4th Quarter of 2023. Pullets are in short supply with losses of 2.5 million growing birds, mainly in California. Since the beginning of April close to 8.4 million hens collectively have been depopulated in a sequence comprising one complex in Texas and three related facilities under common ownership in Michigan in addition to a breeder complex in New Mexico.
  • This past week chains apparently narrowed the spread between delivered cost and shelf price. This could result in a continued reduction in generic stock with a proportional rise in demand but only with constant re-ordering to fill the pipeline through May. Discounters are holding prices on generics 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 2.8 percent overall this past week to 1.69 million cases with a concurrent 11.5 percent increase in breaking stock, following a 0.2 percent increase during the preceding processing week. Demand for egg products has fallen into May attributed to less home-baking and entertaining. Egg products are required for the food service and manufacturing sectors and for exports that increased in February.
  • 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 compared to the USDA regional inventory figures. Changes in stock held by DCs and in the pipeline as determined by weekly orders are probably responsible for small cyclic fluctuation in weekly industry stock, especially into and after a holiday weekend.

 

 

  • Cases of HPAI in the commercial poultry industry and backyard (non-commercial WOAH) flocks tapered during the first quarter of 2024, coincident with the end of the Fall migration of waterfowl that was extended into late 2023 by mild weather. The emergence of the infection in a large complex with 2 million birds in western Texas suggested a reoccurrence of the epornitic as northward spring migration has commenced. The three subsequent related cases in Michigan involving a total of 6.4 million hens may have commenced as an indirect extension from an infected dairy herd although an epidemiologic evaluation in progress will be required to confirm the source and routes of intra-Company dissemination. The number and extent of future possible outbreaks during the spring and fall months of 2024 cannot be projected but sporadic cases in backyard poultry and close to 40 dairy herds in nine widely diverse states is a cause for concern. More surveillance information should be released by USDA-APHIS as it becomes available concerning the prevalence rate of carriers among resident domestic free-living birds and a review of molecular and field epidemiology for the 2022 spring and fall waves of HPAI. The USDA has yet to identify and release specific modes of transmission for the 2022-2023 epornitic including likely 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 apparently down by 0.4 million hens (0.1 percent) to a new level of 306.6 million for the week ending May 1st The stated total flock of 311.9 million included about one million molted hens that will resume lay during coming weeks plus 4.5 to 5.0 million pullets scheduled to attain production. Given the latest figures it is estimated that the producing flock is at least 17 to 20 million hens lower than before the onset of HPAI in 2022. In January 2024 the USDA adjusted figures to account for depopulation of 13 million hens spread over the last quarter of 2023. There were evident discrepancies between published figures and the theoretical number of hens over successive weeks taking into account known losses and predetermined pullet replacements. The April loss of 8.4 million hens is not reflected in data released over the past four weeks. It is hoped that the USDA agency responsible for publication of flock size will get their act together and coordinate with APHIS to record the number of depleted flocks and promptly provide accurate data. Figures released on May 1st overestimate flock size
  • The ex-farm price for breaking stock (rounded to one cent) was down 14.9 percent to $1.34 per dozen.Checks delivered to Midwest plants were down 18.2 percent to $1.17 per dozen this past week. Prices for breaking stock should follow the wholesale price for shell eggs usually with a lag of about one to two weeks.

 

The Week in Review

 

Prices

 

According to the USDA Egg Market News Reports released on April 29th 2024, the Midwest wholesale price (rounded to one cent) for Extra-large was down 16.1 percent from last week to $2.04 per dozen. Large was down 16.2 percent to $2.02 per dozen. Mediums were down 16.5 percent to $1.92 per dozen delivered to DCs. Prices should be compared to the USDA benchmark average 4-Region blended nest-run cost of 75.3 cents per dozen as determined by the Egg Industry Center based on USDA data for March 2024. This value excludes provisions for packing, packaging materials and transport, amounting to 57 cents per dozen as determined in mid-2023 from an EIC survey (with a low response) and now realistically 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 and 2024 to date is depicted in the USDA chart reflecting three years of data, updated weekly.

The April 29th edition of the USDA Egg Market News Report confirmed that the USDA Combined Region value (rounded to the nearest cent), was unchanged at $2.50 per dozen delivered to warehouses for the week ending April 26th 2024. This average price lags current benchmark Midwest weekly values by one week. The USDA Combined range for Large in the Midwest was $2.41 per dozen. At the high end of the range, the price in the South Central region attained $2.57 per dozen. The USDA Combined Price last week was approximately $0.95 per dozen above the 3-year average of $1.55 per dozen. This past week Midwest Large was approximately $1.05 per dozen above the corresponding week in 2023 that was falling from a peak price of $3.70 per dozen five weeks previously to $1.45 per dozen as production recovered from HPAI depletion but with declining market demand.


 


USDA Data On Cage-Free Production For April 2024

05/01/2024

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 April 2024, released on May 1st 2024, documented the complement of hens producing under the Certified Organic Program to be 16.7 million (rounded to 0.1 million), down 8.2 percent from March 2024. This is due to depopulations carried out as a result of HPAI. The number of hens classified as cage-free (but excluding Certified Organic) and comprising aviary, barn and other systems of housing apparently declined by 6.8 percent from March 2024 to 99.2 million, also due to flock depopulation. Hen numbers posted by the USDA for April are considered accurate in relation to known depopulation figures released by APHIS.

 

The number of eggs collected is accepted as accurate but since the values for average weekly production are unacceptably high suggesting that the denominator reflecting the number of hens is probably incorrect. Alternatively if conventional eggs from cages are deceptively marketed as cage-free, or if cage free eggs are packed as certified Organic, assuming an accurate number of hens over a given month, the apparent hen-week value would be incorrectly high. The respective numbers of hens claimed for organic and cage-free flocks should reflect chick placements, HPAI depopulation and age-related depletion and should correspond to monthly supply data and inventory extending over successive quarters. Unlike conventional cage production cage-free hens are not generally molted reducing this possible reason for error in calculating rates of production.

 

Average weekly production for Certified Organic eggs in April 2024 was down 7.5 percent compared to March 2024 with a questionably high average weekly production of 84.4 percent, down from 83.8 percent in March. Average weekly flock production for cage-free flocks other than Certified Organic was down 6.2 percent in April 2024, also with a questionably high average hen month production of 83.4 percent, up from 83.8 percent. Seasonally, younger flocks increase the availability of cage-free and organic eggs in response to pullet chick placements 22 weeks previously in anticipation of peak seasonal demand periods. April 2024 data may have reflected a presumed higher proportion of younger flocks derived from pullet chicks placed during late December 2023 and early January 2024 in anticipation of Easter 2024 demand. Since the proportion of pullets according to housing type is not indicated in the monthly USDA Chickens and Eggs report, it is not possible to assess the relative sizes of flocks producing under the certified organic label or other categories. There is no adequate explanation for the high production rate especially if the stated number of hens is lower than actual, especially with undercounted HPAI flock depopulation. This raises the question of possible illegal diversion of caged eggs into the cage-free or cage-free eggs into the organic supply.

 

Flock Size Average

(million hens)

April

2024

Average

Q1-

2024

Average

Q4- 2023

Average

Q3 –

2023

Average

Q2 –

2023

Average

Q1 –

2023

Certified Organic

16.7

18.3

18.7

 18.7

18.2

17.3

Cage-Free Hens

99.2

105.7

106.4

105.4

 103.2

98.1

Total Non-Caged

115.9

124.0

125.1

124.1

 121.4

 115.4

Average Weekly Production (cases)

March

2024

April

2024

Certified Organic @ 84.4% hen/day

297,224

274,937 -7.5%

Cage-Free @ 83.2% hen/day

1,711,190

1,605,671 -6.2%

Total Non-Caged @ 83.4% hen/day

2,008,415

1,880,608 -6.4%

 

Average Nest Run Contract Price Cage-Free Brown

$1.68/doz. (Unchanged since September 2023)

April 2024 Range:

$1.35 to $2.35/doz. (unchanged since March 2023)

FOB Negotiated April price, grade-ready quality, loose nest-run. Price range $1.80 to $2.00 per dozen

Average April 2024 Value of $1.93/doz.

($2.50/doz. March 2024)

Average April Advertised National Retail Price C-F, Large Brown

$3.47/doz. April 2024 (6 regions)

(was $3.28 in March 2024)

USDA Based on 6 Regions, 4,473 stores

Excluding AK and HI.

 High: $3.52/doz. (SE. 2,286 stores)

 Low: $3.00/doz. (NW. 4 (?) stores)

 

Negotiated nest-run grade-ready cage-free price for April 2024 averaged $1.93 per dozen, down by 22.8 percent from $2.50 per dozen in March 2024, reflecting lower demand relative to supply. The April 2024 advertised U.S. retail price for cage-free eggs over six regions (excluding AK. and HI.) was $3.47 per dozen up 19 cents per dozen (5.8 percent) from March 2024 over 4,473 stores.

 

The apparent difference between a recorded average wholesale price of $1.93 per dozen plus a provision of 60 cents per dozen for packaging, packing and transport results in a price delivered to CDs of $2.53 per dozen. The average six-region advertised retail price of $3.47 corresponds to an average retail margin of 37.2 percent (5.5 percent last month) over the average wholesale delivered price. Margins are presumed higher for pastured and other specialty eggs at shelf prices reaching $9.00 per dozen. Chains that are maximizing margins especially on Certified Organic, free-range and pastured categories restrict the 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 without obvious cause, or alternatively when there is no change in the cage-free flock for sequential months.

 

The May 1st report has accounted for flock depopulations as a result of HPAI in April

 

It is suggested that USDA should consider a quarterly report with more accurate 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.


 

Crop Progress

04/29/2024

Status of the 2024 Corn and Soybean Crops

 

The USDA Crop Progress Report released on April 29th documented planting for the 2024 soybean and corn season. Farmers are in fields with relatively dry conditions in half of the eight major states producing corn and soybeans allowing rapid seeding of prepared acreage. The     “big-eight” (IL, IN, IA, KS, MI, MN, NE and OH) collectively averaged 4.0 (last week 3.5) days suitable for field work this past week ranging from 3.1 days (OH) to 5.2 days (KS)

 

Based on the sum of the “adequate” and “surplus” categories, surface and subsoil moisture levels were higher than the corresponding week in 2023. For the past week surface and subsoil moisture values were 75 and 71 percent for the two highest categories of ‘Adequate’ and ‘Surplus’. These levels were higher than the previous year with values of 72 and 62 percent respectively for the two highest categories, demonstrating an acceptable pre-planting situation.

 

It is to early in the expected transition to a La Nina event to predict any impact on crop condition in coming months. If prolonged dry and hot weather in corn and soy areas occurs, yield will be depressed depending on timing and severity.  A long-range forecast in the form of two charts is provided predicting rainfall and temperature during the growing season.

 

Reference is made to the April 11th WASDE Report #647 under the STATISTICS TAB and the weekly Commodity, Economy and Energy Report in this edition, documenting acreage to be harvested, yields, weekly prices and ending stocks.

 

  WEEK ENDING  

Corn Status (18 states)

March 31st  2024       

April 7th  2024

5-Year Average

Corn Planted (%)

12

27

22

Corn Emerged (%)

3 7 4
       
Soybean Status (18 states)      

Soybean planted (%)

8

18

10

       

 

 

Crop Condition 

(pending USDA reports)

V. Poor

Poor

Fair

Good Excellent

Corn  2024 (%)

         
Corn  2023 (%)          
           

Soybeans  2024 (%)

         
Soybeans  2023 (%)          
 

 

Parameter  48 States

V. Short

Short

Adequate

Surplus
Topsoil Moisture:        

Past Week

6

19

62

13

Past Year 10 18 60 12
Subsoil Moisture:        

Past Week

7

22

61

10

Past Year 13 20 57 10
         

EGG-NEWS will report on the progress of the two major crops as monitored by the USDA through to the end of the 2024 harvest in November.


 

USDA Grain Stocks Report

04/28/2024

The USDA quarterly Grain Stocks Report released on March 28th 2024, documented storage of corn and soybeans, classified according to on-site and remote facilities including elevators and commercial installations. Quantities of the two major ingredients as determined by USD-NASS, relevant to the cost of poultry production were:-

 

“Corn stocks in all positions on March 1, 2024 totaled 8.35 billion bushels equivalent to 54.4 percent of the 2023 crop, up 13 percent from March 1, 2023. Of the total stocks, 5.08 billion bushels (60.8 percent of total) were stored on farms, up 24 percent from a year earlier. Off-farm stocks, at 3.27 billion bushels, are down 1 percent from a year ago. The indicated December 2023 to February 2024 disappearance is 3.82 billion bushels, compared with 3.42 billion bushels during the same period last year”.

 

“Soybeans stored in all positions on March 1, 2024 totaled 1.85 billion bushels equivalent to 44.5 percent of the 2023 crop, up 9 percent from March 1, 2023. Soybean stocks stored on farms are estimated at 933 million bushels, (50.4 percent of total) up 24 percent from a year ago. Off-farm stocks, at 912 million bushels, are down 3 percent from last March. Indicated disappearance for the December 2023 - February 2024 quarter totaled 1.16 billion bushels, down 13 percent from the same period a year earlier”.

 

Prices and commentary are incorporated in the Weekly Energy, Economy and Commodity Report posted each week and a summary of the WASDE #646 released on March 8th is retrievable under the STATISTICS tab.


 

Egg Week

04/24/2024

USDA Weekly Egg Price and Inventory Report, April 24th 2024.

 

Market Overview

 

  • The average wholesale unit revenue values for Midwest Extra-large, Large and Medium sizes were unchanged this past week. Wholesale price for Midwest in cartons at $2.50 per dozen was approximately $0.90 per dozen above the 3-year average of $1.60 per dozen and up $0.80 from the corresponding week in 2023 at $1.70 per dozen. This past week shell egg inventory was up by 1.5 percent, reversing a fall of 1.4 percent the previous week.
  • Although there has been a weekly increase in pullet flocks transferred to laying houses, hen numbers are constrained by the loss of close to 13 million hens due to HPAI on twelve complexes holding from 250,000 to 2.6 million hens during the 4th Quarter of 2023. Pullets are in short supply with losses of 2.5 million growing birds, mainly in California. Since the beginning of April close to 8.4 million hens collectively have been depopulated in a sequence comprising one complex in Texas and three related facilities under common ownership in Michigan in addition to a breeder complex in New Mexico.
  • This past week chains apparently narrowed the spread between delivered cost and shelf price. This could result in a continued reduction in generic stock with a proportional rise in demand but only with constant re-ordering to fill the pipeline into May. Discounters are holding prices on generics 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 1.3 percent overall this past week to 1.64 million cases with a concurrent 0.2 percent increase in breaking stock, following a 1.9 percent increase during the preceding processing week. Demand for egg products continues into May despite less home baking and entertaining. Egg products are required for the food service and manufacturing sectors and for exports that increased in February.
  • 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 compared to the USDA regional inventory figures. Changes in stock held by DCs and in the pipeline as determined by weekly orders are probably responsible for small cyclic fluctuation in weekly industry stock, especially into and after a holiday weekend.
  • Cases of HPAI in the commercial poultry industry and backyard (non-commercial WOAH) flocks tapered during the first quarter of 2024, coincident with the end of the Fall migration of waterfowl that was extended in late 2023 by mild weather. The emergence of the infection in a large complex with 2 million birds in western Texas suggested a reoccurrence of the epornitic as northward spring migration has commenced. The three subsequent related cases in Michigan involving a total of 6.4 million hens may have commenced as an indirect extension from an infected dairy herd although an epidemiologic evaluation in progress will be required to confirm the source and routes of intra-Company dissemination. The number and extent of future possible outbreaks during the spring and fall months of 2024 cannot be projected but sporadic cases in backyard poultry and 32 dairy herds in eight widely diverse states is a cause for concern. More surveillance information should be released by USDA-APHIS as it becomes available concerning the prevalence rate of carriers among resident domestic free-living birds and a review of molecular and field epidemiology for the 2022 spring and fall waves of HPAI. The USDA has yet to identify and release specific modes of transmission for the 2022-2023 epornitic including likely 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 apparently up by 0.9 million hens (0.3 percent) to a new level of 307.0 million for the week ending April 24th The stated total flock of 312.3 million included about one million molted hens that will resume lay during coming weeks plus 4.5 million pullets scheduled to attain production. Given the latest figures it is estimated that the producing flock is at least 17 to 20 million hens lower than before the onset of HPAI in 2022. In January 2024 the USDA adjusted figures to account for depopulation of 13 million hens spread over the last quarter of 2023. There were evident discrepancies between published figures and the theoretical number of hens over successive weeks taking into account known losses and predetermined pullet replacements. The April loss of 8.4 million hens is not reflected in data released over the past three weeks. It is hoped that the USDA Agency responsible for publication of flock size will get their act together and coordinate with APHIS to record the number of depleted flocks and promptly provide accurate data. Figures released on April 24th have overestimated flock size
  • The ex-farm price for breaking stock (rounded to one cent) was unchanged at $1.58 per dozen.Checks delivered to Midwest plants were up 0.7 percent to $1.43 per dozen this past week. Prices for breaking stock should follow the wholesale price for shell eggs usually with a lag of about one to two weeks.

 

The Week in Review

 

Prices

 

According to the USDA Egg Market News Reports released on April 22nd 2024, the Midwest wholesale price (rounded to one cent) for Extra-large was unchanged from last week at $2.43 per dozen. Large was unchanged at $2.41 cents per dozen. Mediums were unchanged at $2.30 per dozen delivered to DCs. Prices should be compared to the USDA benchmark average 4-Region blended nest-run cost of 75.3 cents per dozen as determined by the Egg Industry Center based on USDA data for March 2024. This value 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 realistically 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 and 2024 to date is depicted in the USDA chart reflecting three years of data, updated weekly.


 


Crop Progress

04/23/2024

Status of the 2024 Corn and Soybean Crops

 

The USDA Crop Progress Report released on April 22nd documented planting for the 2024 soybean and corn season. Farmers are in fields with relatively dry conditions in half of the eight major states producing corn and soybeans allowing rapid seeding of prepared acreage. The     “big-eight” (IL, IN, IA, KS, MI, MN, NE and OH) collectively averaged 3.5 days suitable for field work this past week ranging from 2.0 days (OH) to 5.9 days (KS)

 

Based on the sum of the “adequate” and “surplus” categories, surface and subsoil moisture levels were higher than the corresponding week in 2023. For the past week surface and subsoil moisture values were both 72 percent for the two highest categories of ‘Adequate’ and ‘Surplus’. These levels were higher than the previous year with values of 67 percent for the two highest categories, demonstrating an acceptable pre-planting situation. It is to early in the expected transition to a La Nina event to predict any impact on crop condition in coming weeks. If dry and hot weather in corn and soy areas occurs yield may be depressed depending on timing and severity.

 

Reference is made to the April 11th WASDE Report #647 under the STATISTICS TAB and the weekly Commodity, Economy and Energy Report in this edition, documenting acreage to be harvested, yields, weekly prices and ending stocks.

 

  WEEK ENDING  

Crop (18 states)

March 31st  2024       

April 7th  2024

5-Year Average

Corn Planted (%)

Corn Emerged (%)

 

6

0

12

3

10

2

Soybean planted (%)

3

8

4

       

 

 

Crop Condition 

(pending USDA reports)

V. Poor

Poor

Fair

Good Excellent

Corn  2024 (%)
Corn  2023 (%)

         

Soybeans  2024 (%)
Soybeans  2023 (%)

 

         
           
 

 

Parameter  48 States

V. Short

Short

Adequate

Surplus
Topsoil Moisture:        

Past Week

Past Year

 

7

11

21

17

61

59

11

13

Subsoil Moisture:        

Past Week

Past Year

 

9

13

24

21

58

56

9

10

         

EGG-NEWS will report on the progress of the two major crops as monitored by the USDA through to the end of the 2024 harvest in November.


 

Egg Projection

04/19/2024

Updated April 2024 USDA Projection for U.S. Egg Production and Consumption.

 

On April 17th 2024 the USDA Economic Research Service (ERS) issued confirmed values for egg production during 2022 with a projection for 2023 and a forecast for 2024. Production, consumption and prices were only slightly revised from the previous March 14th 2024 report.

 

Projected egg production for 2023 was unchanged from the March 2024 Report at 7,864 million dozen This will be 0.5 percent higher than in 2022 due to progressive replacement of the 44 million hens depleted due to HPAI over the period extending from early spring through mid-December 2022. The per capita consumption of shell eggs and liquids combined for 2023 was unchanged from the March report at 279.3 eggs but down 1.2 eggs (0.4 percent) from 2022. The projected average 2023 benchmark New York bulk unit price was unchanged from the March report at 192 cents per dozen. This was 31.8 percent lower than in 2022 attributed to a comparison with unseasonal high prices from the end of March through the 2nd Quarter of 2023.

 

Subsequent USDA projections will provide greater clarity on the recovery in consumption in an economy that is undergoing deflation. The 2023 Midwest in-carton national wholesale price peaked at $5.17 per dozen on January 3rd 2023 but fell precipitously to a market bottom of $0.78 per dozen on May 8th 2023. Price was restored during February 2024 and settled at $2.50 per dozen on April 12th 2024, higher than for the post-Easter period. This was above the USDA/EIC projection of the combined nest-run March 2024 cost of 75.3 cents per dozen for caged white Large, plus a provision for processing, packaging and transport of 60 cents per dozen amounting to $1.35 cents per dozen delivered to a distribution center.

 

Restoration in flock size after HPAI flock depletions in 2022 progressed at a rate of approximately 0.5 million per week but placements were limited by the availability of pullet chicks and in some companies the rate of conversion to alternative housing systems. Restoration of the national flock was compromised by a resurgence of HPAI with 13.0 million layers depleted during the 4th quarter of 2023 representing 4.0 percent of the nominal producing flock of 325 million hens, mainly on complexes averaging over one million hens. The cost of ingredients will influence margins and may result in cessation of production by some small-scale producers that run out of working capital since financial losses were incurred through summer up to mid-fall. Unpredictable factors affecting price will include the extent of losses during the spring of 2024 due to a predicted reemergence of avian influenza. Approximately 8.5 million hens have already been lost to HPAI during April to date involving mainly four large complexes. Exports of eggs and products at approximately two percent of total production will not materially affect the domestic price.

 

The lagging forecast for 2024 includes production of 7,920 million dozen, up 0.7 percent from 2023. Consumption will attain 280.6 per capita, up a more realistic 1.3 eggs or 0.5 percent above the projection for 2023. USDA project a NY-Large price of $2.03 per dozen up 5.7 percent from the average for 2023.

 

In 2023 egg exports as shell and products combined attained 5,161 million dozen shell-equivalents, or 2.2 percent of production. During 2022 egg imports as a result of HPAI depopulation, some in shell form but predominantly products, attained 25.9 million dozen shell-equivalents, up 42.8 percent from 14.9 million dozen and 26.4 percent from 2021.

 

During 2023 shell egg exports attained 89.4 million dozen, up 28.6 percent compared to 2022 when high domestic prices prevailed. Egg products were up 18.2 percent to 20,814 metric tons compared to 2022. For the first two months of 2024 shell egg exports were up 8.9 percent in volume to 12.2 million dozen, down 26.7 percent in value to $24.1 million compared to the corresponding months in 2023. Unit value was down 26.9 percent to $1.98 per dozen.

 

April 2024 USDA data is shown in the table below:-

 

Parameter

2020

(actual)

2021

(actual)

2022

(actual)

HPAI

2023

(projection)

2024

(forecast)

% Difference

2023-2024

             

Production (million dozen)

8,070

8,031

7,825

7,864

7,920

+0.7

Consumption (eggs per capita)

279.0

282.5

280.5

279.3

280.6

+0.5

New York price c/doz.)

112

119

282

192

203

+5.7

 

Source: Livestock, Dairy and Poultry Outlook released April 17th 2024

 

Subscribers to EGG-NEWS are referred to the postings depicting weekly prices, volumes and trends and the monthly review of prices, exports and related industry statistics.


 

Egg Month

04/08/2024

REVIEW OF MARCH 2024 EGG PRODUCTION COSTS AND STATISTICS.

Commencing in 2024 the EIC justifiably separated the production costs and unit revenue values for eggs derived from caged and cage-free flocks. Accordingly, EGG-NEWS will continue to summarize data but will consolidate production and export statistics for the U.S. egg industry as a total and compare financial data for the two shell-egg categories.

 

FEBRUARY HIGHLIGHTS

  • March 2024 USDA ex-farm blended USDA nest-run, benchmark price for conventional eggs from caged hens was 187 cents per dozen, down 64 cents per dozen or 25.5 percent from the February 2024 value of 251 cents per dozen. For comparison, average monthly USDA benchmark price over 2023 was 146.0 cents per dozen with a range of 323 cents per dozen in January down to a low of 57 cents in May. Stock levels and prices prior to the onset of flock depletions due to HPAI indicated a relative seasonal balance between supply and demand. Future nest-run and wholesale prices will be largely dependent on consumer demand for shell eggs and products and the rate of replacement of pullets and hens depleted due to HPAI. Other considerations include diversion to shell sales from the egg-breaking sector in an interconnected industry.
  • Fluctuation in wholesale price is attributed in part to the amplification of upward and downward swings associated with the commercial benchmark price discovery system in use. Restoration of seasonal prices commenced midway through the fourth quarter of 2023 with a plateau after Christmas followed by a seasonal decline through January 2024. A substantial rise in price occurred during February but with a sharp decline thereafter to mid-March. An unknown factor in future pricing will be the incidence rate and severity of highly pathogenic avian influenza in spring months with northward migration of waterfowl. Close to 13 million hens and 2.5 million pullets were depopulated during the fourth quarter of 2023 among five states with heavy losses in California. Approximately 3.5 million hens were depleted in two outbreaks (TX and MI) during early April.
  • March 2024 USDA average nest-run production cost for generic eggs from caged flocks over four regions (excluding SW and West), applying updated inputs was down 0.7 cents per dozen to 75.3 cents per dozen compared to the February 2024 value of 76.0 cents per dozen, mainly attributable to a 1.7 percent lower average feed cost per dozen. Approximately 60 cents per dozen should be added to the USDA benchmark nest-run cost to cover processing, packing material and transport to establish a realistic price as delivered to warehouses.
  • March 2024 USDA benchmark nest-run margin attained a positive value of 155.1 cents per dozen for generic eggs from caged flocks compared to a positive margin of 170.1 cents per dozen for January 2024. Average nest-run monthly margin over 2023 was 64.2 cents per dozen compared to 155 cents per dozen in 2022. This differential was mainly due to higher prices following HPAI-depletion of flocks. It is emphasized that the U.S. benchmark price reflects nest-run conventional eggs.
  • The March 2024 national flock in production (over 30,000 hens per farm) was stated by the USDA to be down 0.1 million hens (rounded) to 294.6 compared to the revised February 2024 value of 294.7 million. This figure apparently takes into account depletion of 4.2million hens during December 2023 that were not recorded in the month. Approximately 3.0 million hens returned to production from molt in March together with projected maturation of 23.1 million pullets, with this number offset by depletion of spent flocks. During the fourth quarter of 2023 approximately 13 million hens and 2.5 million pullets were depopulated due to HPAI in five states.
  • February 2024 pullet chick hatch of 27.9 million was up 6.9 percent or 1.8 million chicks from January 2024.
  • February 2024 exports of shell eggs and products combined was up 62.5 percent from January 2024 to 641,300 case equivalents representing the theoretical production of 8.5 million hens. The increase was attributed to greater demand for shell eggs by Canada and egg products by Japan and the E.U. among other importing countries.

 

TABLES SHOWING KEY PARAMETERS FOR MARCH 2024.

Summary tables for the latest USDA March 2024 flock statistics, costs and unit prices made available by the EIC on April 8th 2024 are arranged, summarized, tabulated and compared with values from the previous March 13th 2024 posting reflecting February 2024 costs and production data as applicable. Monthly comparisons of production data and costs are based on revised USDA values.

 

VOLUMES OF PRODUCTION REFLECTING THE ENTIRE INDUSTRY

 

PARAMETER

MARCH 2024

 FEBRUARY 2024

Table-strain eggs in incubators

56.6 million (Mar.)

 59.1 million (Feb.)

Pullet chicks hatched

27.9 million (Feb.)

 26.6* million (Jan.)

Pullets to be housed 5 months after hatch

26.9 million (July)

 23.2* million (June)

EIC 2023 December 1st U.S. total flock projection

328.9 (Mar.)

328.0 million (Feb.)

National Flock in farms over 30,000 

294.6million (Feb.)

294.7* million (Jan.)

National egg-producing flock 

 310.4 million (Feb.)

310.5* million (Jan.)

Cage-free flock excluding organic

 106.5 million (Mar.)

106.5 million (Feb.)

Proportion of flocks in molt or post-molt

11.2% (Mar.)

11.2% (Feb.)

Total of hens in National flock, 1st cycle (estimate)

 275.6 million (Feb.)

 275.6 million (Jan.)

Total U.S. Eggs produced (billion)

7.40* February 2024

7.96* January 2024

Total Cage-Free hens in production

124.8 million (Mar.)

14.7% Organic

124.8 million (Feb.)

14.7% Organic

“Top-5” States hen population (USDA)1

145.0 million (Feb.)

148.5 million (Jan.)

 * Revised USDA/EIC

Notes 1. Texas excluded to maintain confidentiality


 


USDA Agricultural Prices Report

11/17/2023

THE USDA Agricultural Prices Report released October 31st posted September prices for agricultural commodities and expenditures.

 

September Prices Received Index, down 2.9 percent from August

 

 The USDA ERS summarized prices as follows:-“The September Prices Received Index 2011 Base (Agricultural Production), at 122.6, decreased 2.9 percent from August and 7.1 percent from September 2022. At 113.9, the Crop Production Index was down 4.2 percent from last month and 11 percent from the previous year. The Livestock Production Index, at 133.1, decreased 0.9 percent from August, and 2.6 percent from September last year. Producers received lower prices for corn, hogs, soybeans, and lettuce during September, but higher prices for broilers, milk, grapes, and broccoli. In addition to prices, the volume change of commodities marketed also influences the indexes. In September, there was decreased marketing of cattle, wheat, cotton, and peaches and increased monthly movement for soybeans, corn, dry beans, and apples”.

September Prices Paid Index, Up 0.1 Percent from August

 

“The September Prices Paid Index for Commodities and Services, Interest, Taxes, and Farm Wage Rates (PPITW), at 138.8, is up 0.1 percent from August 2023 but unchanged from September 2022. Higher prices in September for feeder cattle, feeder pigs, diesel, and nitrogen more than offset lower prices for feed grains, complete feeds, concentrates, and hay & forages”.

 

Corn farmers received $5.21 per bushel in September 2023 compared to $5.73 per bushel in August 2023, down 9.1 percent. The price received in September 2022 was $7.09 per bushel

 

Soybean farmers received $13.20 per bushel in September 2023 compared to $14.10 per bushel in August 2023, down 6.8 percent. The price received in September 2022 was $14.20 per bushel

 

The September 2023 egg price received by farmers was $ 1.22 per dozen for table eggs lower than $1.35 per dozen in August 2023 and compared to $2.65 per dozen in September 2022. The sharp year-on-year increase is attributed to disequilibrium between supply and demand. Highly pathogenic avian influenza resulted in depletion of 44 million hens with a reduction of 20 million producing birds in the supply flock on average from mid 2022 onwards. This situation was coupled with increased demand as consumers increased purchases of eggs representing a competitively priced protein source in an inflationary environment.


 

Planted Acreage Report

06/30/2023

The June 30th 2023 Planted Acreage report documented the respective areas planted to corn and soybeans, the two commodities of relevance to the poultry industry. The USDA confirmed:-

 

Corn-planted area for all purposes in 2023 is estimated at 94.1 million acres, up six percent or 5.52 million acres from last year. This represents the third highest planted acreage in the United States since 1944. Compared with last year, planted acreage is expected to be up or unchanged in 43 of the 48 estimating States. Area harvested for grain, at 86.3 million acres, is up nine percent from last year.

 

Soybean-planted area for 2023 is estimated at 83.5 million acres, down five percent from last year. Compared with last year, planted acreage is down or unchanged in 21 of the 29 estimating States.

 

Together with the Grain Stocks report the Planted Acreage data moved the market for corn and soybeans by about five percent but in contrasting directions.

 

For corn the acreage was above the most optimistic projection although offset by a lower stock. At 14H30 on the CME after the release of the two USDA reports, corn was down 25 cents per bushel to 556 cents for July delivery and for September, corn was down 34 cents per bushel to 489 cents.

 

For soybeans the reduced acreage and consequently lower ending stocks was bullish for the new crop. At 14H30 CME soybeans were up 75 cents per bushel to 1,558 cents for July delivery and for September the soybean price was up 73 cents per bushel to 1,354 cents.


 

USDA-ERS Predicts Egg Prices for 2023

02/27/2023

According to USDA economists, retail egg prices increased by 8.5 percent in January 2023, approximately 70.1 percent above January 2022.  The USDA-ERS now predicts that egg prices will increase by 37.8 percent in 2023 but with a wide range of 18.3 to 62.3 percent attributed to volatility.  Concurrently the USDA-ERS predicted a 4.7 percent increase in the price of meats, 7.2 percent for dairy products and 12.8 percent for cereals and bakery products.

 

Wholesale farm-level egg prices are predicted to increase by 7.4 percent in 2023 with a wide prediction interval of -32.6 to 76.1 percent.  Egg prices are extremely volatile, complicating reliable predictions.

 

EGG-NEWS will monitor weekly USDA wholesale prices by region and average retail prices to document retail margins.


 




























































































































































































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