Decreased production and increased costs in the turkey market


While the heat of August may cause you to move the idea of ​​holiday dinners down to the bottom of your priority list, family cooks are taking note: this can be another tough year to prepare for the next day. perfect Thanksgiving or Christmas turkey dinner.

James Mitchell, extension agricultural economist for the Agriculture System Division at the University of Arkansas, said two major factors will affect the price and availability of whole turkeys and other poultry products this holiday season.

The first is overall turkey production, Mitchell said. The US Department of Agriculture is currently forecasting a 1.5% drop in turkey production from 2020, down 84 million pounds. The decline, coupled with the gradual decline in cold store inventories, resulted in a 13% increase in the cost of frozen whole hens, to about $ 1.16 / lb on average.

“Much of this reduction occurred in the first half of the year,” Mitchell said. “In many ways, this was a ripple effect of the struggles the industry experienced during the 2020 pandemic.”

As the covid-19 pandemic hit the United States in March 2020, many companies have shut down, laid off non-essential employees, or instructed employees to work remotely when possible. In industries such as agriculture, where remote working is often impractical, production has sometimes slowed at a breakneck pace as covid infections have caused facilities to shut down temporarily. This has led to major bottlenecks in the production of timber, poultry and beef, among other sectors.

“To wrap up 2021, the USDA is forecasting only slightly lower production in the fourth quarter of the year,” Mitchell said. “So the general outlook is to see fewer total pounds available this year. For me, it’s still hard to say how noticeable this drop in supply will be at the grocery store during the holiday season.”

In 2019, Arkansas produced approximately 576 million pounds of turkey, worth more than $ 333 million to the state.

Mitchell said the second factor, which may turn out to be more important than the first, is that the nature of meat and poultry processing in the age of covid could mean reduced availability of specific products, such than lighter, fresh turkeys and value-added products. like breast meat.

MORE THAN JUST COVID

“The workforce problem is both driven by covid-19 and follows the trend of an aging and declining rural population where these processing plants are located,” Mitchell said. “Throughout the pandemic, the cost of producing meat processing has been considerably higher. It shouldn’t be a surprise now. Think about the significant investments processors had to make to keep workers safe and keep factories running.

“Does that mean consumers will be in a rush this holiday season? My reaction is, not as much as some headlines might suggest,” he said. “Retail grocery stores are dedicated to transporting products, and they will continue to do so with features and offers like buy-a-buy-one, and so on. “

While 14lb and 16lb turkeys – the most popular sizes sold in US retail grocery stores – can get noticeably more expensive and a little less available, prices for separate birds are already significantly higher. Since April, wholesale breasts prices have increased 73%, Mitchell said.

Mitchell said these types of pricing and availability issues are likely to affect more than popular holiday birds this season.

“These problems are not unique to Turkey,” he said. “We have seen similar problems with boneless hams and value-added pork. Proactive planning on the part of our holiday cooks is probably warranted.

To learn more about extension programs in Arkansas, contact a local Cooperative Extension Service agent or visit www.uaex.uada.edu. Follow the agency on Twitter and Instagram at @AR_Extension.

Ryan McGeeney works in the Agricultural System Division at the University of Arkansas.

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