August 2016 Production Data
According to USDA data, the estimated average complement of U.S. hens in flocks over 30,000 during July amounted to 290.0 million, down 1.4 million from June. The total U.S. flock based on USDA data amounted to 299.6 million on August 1st 2016. The average annual flock sizes for 2012, 2013 and 2014 were 285.3, 289.1 and 303.0 million hens respectively. The advent of HPAI with unprecedented mortality has complicated all models projecting future flock sizes and prices. Although in the July report the EIC estimated a flock size of 326.7 million hens in December 2016, up from 323.8 projected in the May EIC report no forecasts were issued in August but it is doubtful that the flock will exceed 310 million. The previous model based on pullet chick placements and patterns of depletion is currently unrealistic. Pullet chick placements were down 26 percent in July compared to a seasonal reduction represented by a 9.3 percent reduction from June to July in 2015. It is possible that low prevailing prices will result in flock reduction due to some producers ceasing operation, from early depletion or adoption of single-cycle programs.
The total in-molt and post-molt population of hens in the 5-Regions monitored by the USDA increased by 1.0 percent in August 2016 to 21.4 percent of the national flock compared to 21.2 percent in July and the 2015 average of 20.6 percent. Hens were molted in late March due to an early Easter and the sharp downturn in prices thereafter.
USDA statistics show an anticipated decrease of 21.3 million pullets to be housed during August through December 2016 compared to the corresponding months in 2015. Pullet chicks hatched during January 2016 (23.8 million), February (25.23 million), March (23.7 million), April (24.2 million), May (28.6 million), June (29.05 million) and July (21.47 million) collectively represent an 11.6 percent increase, or 2.7 million pullets per month over the corresponding months in 2015. The large increases in pullet placements from February through June 2016 compared to corresponding months in 2015 is attributed to restocking after HPAI losses in 2015.
The hatchery supply flock increased from a level of 2.6 million hens in production in June 2015, coinciding with the end of the HPAI epornitic to 2.9 million hens in November 2015. Projections show a monthly average of 3.0 million and 2.8 million breeder hens in production during the third and fourth quarters of 2016 respectively. With decreased demand parent flocks will be depleted earlier than planned.
Slaughter of hens under USDA-FSIS inspection attained 4.56 million in July. This is lower than the pre-HPAI monthly average of 5.8 million hens over the period extending from January through May 2015 but consistent with the 6-year average of 4.98 million hens in July. Depending on availability of housing, flocks were retained from June through December 2015 to take advantage of higher prices. Regular mortality and alternative methods of flock disposal including landfills, rendering and shipment of live hens to Canada, accounts for the majority of depletion amounting to an average of 12 to 13 million hens per month.
Average rate of lay attained 78.2 percent over the first seven months of 2016 and increased to 79.2 percent in July as new pullets transferred in late May and early June 2016 achieved peak production. Average production reflects the balance between placement of pullets, their age at transfer and the rate of depletion of flocks or retention of molted hens for a second cycle. Average flock production will rise as weighted flock age is reduced by early depletion and restricting production to the first cycle.
July 2016 Export Data
According to USDA-FAS data, 283 thousand cases of shell eggs were exported in July 2016 representing 1.5 percent of total production. North America (33.3 percent of exports), East Asia (30.3 percent) and the Caribbean (24.0 percent) comprised the major importing regions. Exports of shell eggs during the second quarter of 2016 were 30.3 percent lower than the monthly average for the corresponding period in 2015 before the advent of HPAI. Exports will depend on possible future embargos, availability of eggs, international competition and domestic prices. During July 100 thousand cases of eggs were imported.
Exports of egg products in July 2016 amounting to 237 million case-equivalents represented 1.1 percent of U.S. output with North America (33.5 percent), East Asia (31.9 percent) and Central America (9.9 percent,) comprising the principal importing regions. Due to the shortage of breaking stock and reduced capacity through large in-line units, exports were curtailed in 2015 and volume decreased by 34.8 percent compared with 2014, attaining 1.7 percent of total U.S. output. For the first seven months of 2016 export volume was 39.8 percent lower than in 2015. During July imports corresponded to 90 thousand case-equivalents approximating pre-HPAI volume.
Collectively, exports of shell eggs and products in July 2016 represented the equivalent of approximately 6.6 million hens in production during the month, attaining 519 thousand case-equivalents. This was a 45.9 percent decrease compared to monthly average shipments of 960 thousand case equivalents exported over the first four months of 2015 prior to the advent of HPAI. Actual net exports of both products and shell eggs amounted to 330 thousand case-equivalents or 4.2 million domestic hens representing 1.4 percent of a nominal 300 million hen flock.
AUGUST 2016 STATISTICS
COSTS & REVENUE
Parameter JULY 2016 AUGUST 2016
5-Region Cost of Production ex farm (1st Cycle) 62.03 c/doz 59.99 c/doz
Low 58.28c/doz (MW) 55.65c/doz (MW)
High 77.07 c/doz (CA) 75.60 c/doz (CA)
Components of 6-Region 1stCycle Cost of Production:-
JULY 2016 AUGUST 2016.
Feed 33.88c/doz 32.09 c/doz
Pullet depreciation 11.00 c/doz 10.75 c/doz
Labor 4.00 c/doz 4.00 c/doz
Housing 5.30 c/doz 5.30 c/doz
Miscellaneous and other 7.85 c/doz (adjusted Nov. ‘15) 7.85 c/doz
Ex Farm Loss according to USDA values reflecting August 2016:-
39.8 cents per dozen1- 60.0 cents per dozen = -20.2 cents per dozen
(July comparison 39.9 1 cents per dozen – 62.0 cents per dozen = -22.1 cents per dozen.)
Note 1: USDA Blended egg price
JULY 2016 AUGUST 2016
USDA ex-farm Price (Large) 39.9c/doz 39.8 c/doz
Warehouse/Dist. Center 69.1c/doz 57.2 c/doz
Store delivered 74.5c/doz 62.7 c/doz
Dept. Commerce retail 149.1 c/doz (June) 154.6c/doz (July)
5-Region Layer Feed Cost
Layer Feed Cost (Average) $215.79/ton $204.38/ton
High $245.40/ton (SE) $234.27/ton (SE.)
Low $194.82/ton (MW) $180.06 /ton (MW)
Differential $ 50.58/ton $ 54.21/ton
(equivalent to 13.7 cents per dozen)
Pullet Cost (19 weeks) $3.79 $3.71
VOLUMES OF PRODUCTION
Parameter JULY 2016 AUGUST 2016
Egg-strain eggs in incubators 44.08 million (July) 38.2 million (Aug.) -32%
Pullet chicks hatched 29.05 million (June) 21.5 million (July) -26%
Pullets to be housed in 5 months 26.2 million (Nov.) 19.4 million (Dec.) -26%
National Flock in farms over 30,000 291.4 million (June) 290.0 million (July)
National egg-producing flock 301.0 million (July) 299.6 million (Aug.)
Proportion of flock in molt or post-molt 21.4% (Aug.)
Total of hens in 1st cycle (estimate) 235.5 million (Aug.)
5-Region proportion of in molt or molted hens 21.2% 21.4%
High (CA) 36.0% (CA) 32.5%
Low (NE) 5.2% (NE) 4.0%
Hens processed under FSIS inspection 5.2 million (June) 4.6 million (July)
Eggs produced 7.10 billion (June) 7.36 billion (July)
Table-egg hens in flocks over 30,000 (97.2% of total U.S.) 291.4 million (June) 290.3 million (July)
“Top-6” States hen population (USDA) 162.5 million (June) 161.5 million (July)
Proportion of U.S. Total by state, 2016
*(over 30,000 hen flocks)
STATE JUNE 2016 JULY 2016 Proportion by region (JULY 2016.)
Iowa 17.1% 17.5% MW 52.4%
Ohio 10.5% 10.3% NE 11.3%
Indiana 10.0% 9.8% SE 10.7%
Pennsylvania 8.6 % 8.6% SC 10.6%
Texas 5.5% 5.5% CA 4.0%
California 4.1% 4.0% NW 4.6%
(Values rounded to 0.1%)
Rate of Lay, weighted hen-week (USDA) 78.6% (June) 79.2% (July)
Actual USDA-ERS 2015 U.S. per capita annual egg consumption revised due to HPAI:- 252.9 eggs (-13.7 from 2014)
Projected USDA-ERS 2016 U.S. per capita annual egg consumption projected to be:- 264.0 eggs (+11.1 from 2015)
Eggs broken under FSIS inspection (million cases)
JUNE 2015 6.675 JULY 2016 6.576
Cumulative proportion of total eggs 31.1% 31.2%
Monthly proportion of broken eggs 33.8% 31.6%
Parameter Quantity Exported
Shell Eggs (thousand cases) JUNE 2016 244 JULY 2016 283
Products (thousand case equivalents) JUNE 2016 245 JULY 2016 237
Total (thousand case equivalents) JUNE 2016 489 JULY 2016 520
Net Exports (thousand case equivalents JULY 2016 330*
*Representing 1.4 percent of National production in July 2016