U.S. turkey stocks send mixed signals for winter holidays
By Theopolis Waters
CHICAGO (Reuters) - The overall amount of frozen turkeys in U.S. warehouses last month declined from July and August 2014, after an outbreak of bird flu killed over nine million turkeys, experts said after Tuesday's government monthly cold storage report.
Based on a five-year average, the experts said tom turkeys accounted for most of that drawdown rather than hens, however. Hens are a Thanksgiving and Christmas holiday staple.
August frozen whole turkeys stocks totaled 289.2 million lbs, down 8.1 million from July and down 11.6 million from August 2014.
Hens in August totaled 160.0 million lbs, down almost 12 million from July and 4.1 million less than last year. Toms were 129.2 million lbs, 3.6 million more than July but 7.5 million below last year.
Turkey inventories tend to increase 11 million lbs during August based on a five-year average, said independent market analyst Bob Brown, but "we went the opposite direction."
However, he pointed out that hen stocks were only down 4 million lbs from last year and actually up 14 million lbs from their five-year average, compared to toms that fell 35 million.
"There doesn’t appear there is a shortage of hens. We do have at least a normal level in the freezer," said Brown.
Analysts were surprised by the overall drop in August turkey stocks considering the unexpected spike in July inventories despite the bird flu impact.
Dan Vaught, an economist at Missouri-based Doane Advisory Services, surmised that farms affected by the virus may have had younger turkeys that were more vulnerable rather than older birds.
While there are fewer total turkeys than last year versus plentiful hams, tradition will dictate whether those who buy turkey will continue to do so this Thanksgiving, said Vaught.
"The question is how aggressively grocery stores will feature turkeys, because typically they're featured as loss leaders for folks to come in a buy other items," he said.
USDA's report showed record-high pork and ham inventories for a third month in a row as the industry recovers from a deadly pig virus.
Total pork inventories in August were 656.3 million lbs, an all-time high for the month, surpassing the previous August top of 585.8 million in 2012. It follows July and June records of 635.2 and 634.5 million lbs, respectively.
August hams at 237.5 million lbs were the most ever for any month, besting September 2013's 221.633 record.
(Reporting by Theopolis Waters; Editing by Tom Brown)
