FarmEcon LLC Monthly Turkey Supply-Use Tracker
Based on USDA data, monthly supply and use trends for the U.S. turkey industry are shown below. This information will be updated on about the 5th of the month after the last data pieces, export and import tonnage, are published by USDA.
These charts show annualized data for domestic use, total domestic and export use, and the major components that go into the use statistics. All data are taken from the USDA sources noted. This information is supplied gratis to the turkey industry as a sincere thank you for all the incredible support given to FarmEcon LLC since 2003.
Updates: This update was published on December 11, 2019.
Overview - Domestic and total monthly turkey use
Monthly domestic turkey use and 12-month moving average
Monthly domestic use is calculated as:
Beginning Frozen Stocks (USDA/NASS Cold Storage Report)
+Production, RTC weight (USDA/NASS Poultry Production Report)
+Imports (USDA/FAS GATS Trade Database)
-Exports (USDA/FAS GATS Trade Database)
-Ending Frozen Stocks (USDA/NASS Cold Storage Report)
Comments: The 2017 domestic use 12-month moving average trend was flat compared to prior year. 2018-2019 moving average use data shows little overall change from 2017, but trended slightly downward over the last year until April, 2019.
Holiday seasonality is clearly evident in the raw monthly data. HPAI decreased 2015 domestic use, with recovery following as production rebounded. Monthly domestic use is essentially unchanged since late 2016. The moving average takes out the seasonality and reveals the longer term use trend.
Monthly domestic and export turkey use and 12-month moving average
Monthly domestic and export use is calculated as:
Beginning Frozen Stocks
+Production, RTC weight
-Ending Frozen Stocks
Comments: Total 2018 use was marginally below 2017. Until September 2018 monthly total use and exports were little changed from 2017. Starting in late 2018 total use trended downward until April 2019. Both domestic use and exports were over prior month and prior year. April 2019 total use was the highest April since 2012.
The 2015 HPAI outbreak reduced production, domestic use, and exports. Exports were reduced mainly by phytosanitary trade bans imposed by numerous countries. By 2017 domestic use had recovered to pre-HPAI levels. However, despite increases since 2015 exports have not fully regained the HPAI losses. See the last two charts on this page for export details. The moving average takes out the seasonality and reveals the longer term use trend.
Detailed components of domestic and total monthly turkey use
Monthly turkey production and 12-month moving average - RTC weight
Monthly production is ready-to-cook federally inspected turkey production as reported in the USDA Poultry Production Report.
Comments: The industry sustained an almost 500 million pounds per month moving average production level since late 2016 into early 2018. Low prices have led to slowly declining production since early 2018. Declining production is helping reduce stocks in the face of flat use.
Monthly eggs in incubators, net poult placements, % poult hatch placed and 12-month moving averages
Monthly eggs in incubators on the first of the month and net poult placements are from the USDA Turkey Hatchery Report. Percent of poults hatched during the month is net placements divided by hatched poults (not shown). Not all hatched poults are used for turkey production. The percent can be slightly over 100% if hatched poults are placed in the month following hatch.
Comments: Reflecting depressed 2017 pricing, 2018 saw a dip in eggs in incubators and 2019 has seen a slow decline. In 2018 the percent of poults placed trended up until November. However, eggs in incubators and net placements have trended downward since. Percent poults placed was under 90% in the last 2 months available. The sector is operating at below potential production level possible if more eggs were placed and poults were to be placed. (The sharp October 2018 dip in % poults placed is a statistical anomaly.)
Monthly turkey exports and 12-month moving average
Monthly exports are sourced from the USDA/FAS GATS database.
Comments: Exports were at record levels prior to the 2015 HPAI outbreak, and have not fully recovered since. While the mid-2016 to April 2018 12-month moving average trend was very positive spring and summer exports were weak. 2019 exports have trended higher since March but at a slow pace. Returning to Pre-HPAI export levels will require regaining full market access in countries that still ban U.S. turkey imports and also fully recovering lost volume in key countries like Mexico that have long since dropped their HPAI-related bans.
Monthly turkey frozen stocks and 12-month moving average
USDA reports frozen turkey stocks monthly in the Cold Storage Report. Only frozen product is reported, not refrigerated. Within frozen, stocks that are sold for export, but not shipped, are excluded. Weighted average spot parts prices and whole bird prices are also shown. The parts prices are from USDA, weights are based on average carcass yields.
Comments: November marks a seasonal stocks low. November stocks increased in 2016 and again in 2017 but were lower in 2018. Despite the November year-on-year decline, frozen stocks remain at levels not seen since 2013. Until market forces bring production and total use into better balance, high stocks levels will overhang the market, and limit upside pricing opportunities.
As recently as 2009 the industry has seen peak stocks higher than 2017/2018. Typical peak frozen stocks in the late 1990's exceeded 700 million pounds. However, in recent years increasing holiday season fresh bird sales have reduced the need for frozen birds, making comparisons to long-term historical data less meaningful. What is apparent from the graph above is that 2016/2018 peak frozen stocks increased, with the 2017 increase being particularly large. The increasing 12-month moving average that started in 2016 has leveled out and started to decline slightly over the last few months. Nonetheless, large stocks continue to be a barrier to pricing improvements.
May 2019 stocks were 7.7% lower than the prior April. The lack of stocks increases evident in the May 2018 to May 2019 12-month moving average is very unusual. The decline in 2019 stocks is evident in the moving average.
Monthly days of turkey use in total stocks, and 12-month moving average
Another way of looking at stocks is how much is in frozen inventory relative to total monthly use. The lower the value, the tighter are the stocks relative to use. The statistic is calculated as:
Monthly total frozen stocks
÷ Monthly turkey total use
x Number of days in the month.
Example - Stocks are 300 million pounds, total use is 500 million pounds, and there are 30 days in the month.
300 ÷ 500 X 30 = 18 days of use in inventory.
The number represents days-adjusted buffer stock held in frozen stocks at locations surveyed by USDA. It shows how many days it would take to use up those stocks at the current use rate.
Comments: There is, naturally, significant seasonality to the statistic. During the year millions of pounds of frozen whole bird stocks are put back for the holiday season, then sold mainly in October-November. The typical peak stocks are in June or July at about 35 to 40 days. Peak stocks have declined since 2017. After peak frozen birds start to move to retail freezer space, and disappear from the USDA Cold Storage Report. The seasonal low is always November, and generally around 10 days.
The November 2017 and 2018 seasonal low days of stocks in inventory were well over the 10 day normal, and significantly higher than any recent period. Since late 2017 the moving average remained stuck at 30 days until early 2019 when stocks started to decline.
Monthly turkey frozen stocks details by product type
In addition to total frozen stocks, USDA also publishes monthly estimates of several categories of turkey cuts and whole birds. These data are shown in the graph below:
Comments: Frozen breasts are mostly a product from heavy toms. High levels of breast and whole tom stocks since 2015 have an indication of a supply-demand imbalance in this key white meat turkey sub-market. Similarly, the relatively small 2016-2018 increases in hen stocks also reflect a minor holiday whole bird supply-demand imbalance. Maintaining year-over-year stocks reductions are vital to improving pricing prospects. All of the stocks declines have originated with lower production.
Annual turkey product export details by FAS product category
USDA data on 2012 to 2018 exports by FAS product category of turkey cuts and whole birds are shown in the graph below. Data are from the USDA/FAS GATS database.
Comments: Almost all of the chilled cuts and whole birds go to Mexico. All post-HPAI product exports dropped off, but Mexico chilled cuts volume has held up much better than the rest of the world. Overall, 2018 exports were little-changed from 2017.
Annual turkey exports by destination details, top 10 and all others
USDA data on 2012 to 2018 turkey exports by country of destination are shown in the graph below. Data are from the USDA/FAS GATS database.
Comments: Mexico accounts for about half of U.S. turkey exports. Exports have not recovered in many smaller volume markets and China. In 2012 and 2013 China imported over 40,000 tons of U.S. turkey. Imports since the 2015 HPAI outbreak have been zero. Recovering access to the China market would represent major progress in restoring exports to pre-2015 levels. Cuba and Russia, at one time also significant markets, have also not resumed U.S. turkey imports while volume to the Philippines has also dwindled.