Source: Lisa M. Keefe, MEATINGPLACE, 4/23/14 

Two reports out from USDA’s National Agricultural Statistics Service paint a picture of higher protein prices to come. Total U.S. meat (chicken, beef and pork) in freezers declined 12.3 percent year-over-year, the biggest drop in nearly four years, noted JPMorgan equity analyst Ken Goldman in a report to investors.

Total stocks of chicken were down 14 percent from the previous month and down 6 percent from last year — the first year-over-year decline since October 2012, Goldman noted. Meanwhile, total pounds of turkey in freezers were up 8 percent from last month but down 16 percent from March 31, 2013.

“Although higher chicken prices during March suggested a potential drop in inventories, we were a bit taken aback by the slope of the drawdown,” he wrote.

On the red meat side, Frozen pork supplies were down 12 percent from the previous month and down 11 percent from last year, a “sudden and precipitous” decline year-over-year, Goldman noted.

“We expected cold storage numbers to be flattish — we thought pork users might have been stockpiling product in advance of the summer, when PEDv’s effects will be greatest — but this apparently was not the case,” he said.

Total pounds of beef in freezers were down 1 percent from the previous month and down 21 percent from last year. Stocks of pork bellies were down 9 percent from last month but up 55 percent from last year.

On another front, data regarding the chicken broiler flock does not point to a major rebuilding effort: Broiler-type chicks hatched during March 2014 totaled 770 million, down slightly from March 2013. Eggs in incubators totaled 628 million on April 1, 2014, up slightly from a year earlier.

Leading breeders placed 6.79 million broiler-type pullet chicks for future domestic hatchery supply flocks during March 2014, up 3 percent from March 2013.

“The number of pullet chicks hatched during March was up 3.1 percent year-over-year. This came off a (decline of) 2.4 percent and hatchings were 1.5 percent below the 10-year average. The total number of hatching layers remained well below the 10-year average, while the number of eggs/layer continue to be constrained by an older, less productive set of hens. At this point, we will be surprised if chicken meat production rises meaningfully in any month this year,” Goldman said.

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