In The News This Month – April 2022
Editorial
April is usually a month we associate with spring flowers and the Easter season. In March we saw many articles addressing concerns about egg shortages and increased prices as we approached the Easter holiday. Some believed that so much focus on shortages being caused by the highly pathogenic avian influenza led to a higher consumer demand. We saw unusually high prices in April compared to both 2020 and 2021. As the month ended it seemed that most retail chains had replenished their pipelines after Easter. Reports from egg-news.com state we should see a mild decline in prices through May. Hopefully we do see a price reduction on eggs early in May to help us prepare those egg dishes for Mother’s Day brunch!
News about HPAI continued throughout April and, unfortunately, we will probably still be talking about its impact for months to come. As of mid-April, over 31 million birds in the US commercial poultry industry had been lost to this outbreak. WattPoultry has broken down these cases by flock. Birds have been lost across the egg, turkey, broiler, duck, and gamebird industries. Although the commercial egg industry has lost the most birds (because of the larger flock sizes in layer operations), the most HPAI cases in the US this year have been reported in turkey flocks. Although more species are affected, reports are showing that there are fewer total deaths in this outbreak than in 2015, except in the turkey industry. Turkey breast prices are climbing to rates seen in 2015 and experts are concerned about the impact on production and exports. A bit of positive news, a recent WATTPoultry Chat video with Dr. Thomas Elam of FarmEcon LLC stated that HPAI’s spread will likely end around mid-May due to warmer spring and summer temperatures.
When the weather does start to warm up this Spring, many people will start to want to spend more time outside and less time preparing their meals. Convenience starts to take priority and consumers start looking for an easier, faster way to shop and prepare their meals. According to Jennifer Bartashus, a senior analyst at Bloomberg Intelligence, “people are looking for convenient options”. Today we can buy pre-cubed beef or pork, but we can’t buy pre-cubed chicken. For fresh chicken we don’t have many options. I love preparing recipes with a rotisserie chicken, but if that chicken was already shredded, I think I would definitely spend the extra cost for the convenience.
As more and more state mandates push the egg industry towards cage-free environments, producers are seeing a variety of housing designs being marketed. But how do you decide which design will be best for your chickens? Which design will have a positive impact on productivity? A new research grant will fund a U.S. project that aims at answering these questions and more. Essentially the research project at Purdue University will attempt to understand how layer hens perceive their environment. They can collect data about layers that will aid in developing housing models. Once these virtual models are designed, they can analyze which details of the house will have an affect on the hens, like color. We can equate this to humans taking a virtual tour of a house, essentially farmers can take their hens on a virtual tour of their new environment. I think most would agree, this would be a cool technology!
Monica Lizar
Account Manager
Aeros, a Cultura Company
Feed and Grains:
Corn prices reach 10-year highs
The last time corn prices were this high, the country was suffering through a once-in-a-generation drought in the summer of 2012. But war in Ukraine and a sluggish planting pace in the U.S. helped extend the rally and raise prices another 1.75% to reach the highest level in a decade. Soybean prices were also firm, rising more than 1.25 higher today. Wheat prices were mixed, meantime, after some uneven technical maneuvering.
Another round of wet weather will arrive in parts of the Plains and Midwest between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA. The Dakotas, Nebraska, Illinois, Iowa and Missouri are likely to see the largest totals during this time. NOAA’s 8-to-14-day outlook predicts more seasonally wet weather for the central U.S. between May 4 and May 10, with seasonally cool weather likely for the Great Plains region.
On Wall St., the volatile Dow climbed 339 points higher in afternoon trading to 33,579 after tumbling more than 800 points on Tuesday. Some strong Q1 corporate earnings reports helped install some investor sentiment today. Energy futures also moved higher, with crude oil up more than 0.5% to reach $102 per barrel. Nearby diesel contracts jumped nearly 5% higher this afternoon, with gasoline up around 4%. The U.S. Dollar firmed moderately.
On Tuesday, commodity funds were net buyers of corn (+2,000), soybeans (+2,000), soyoil (+5,000) and CBOT wheat (+10,000) contracts but were net sellers of soymeal (-5,000).
Read full article here
Despite War, Ukraine Sows 20% of Planned Acreage
Despite a Russian invasion disrupting the entirety of life in Ukraine, the country has managed to sow over 20% of its planned area with agricultural crops, says the Ukrainian government.
During the sowing season-2022, Ukraine sowed 3.02 million hectares of land with the main agricultural crops, which is 20.1% of the 14.4 million hectares planned for the current season, the data on which were adjusted upward by 7.1% the day before (from 13.44 million hectares previously announced), the Ministry of Agrarian Policy and Food said on Friday.
According to data published on its website, over the past week from April 15 to April 21, the area under crops increased by 56%, from 1.94 million hectares to 3.02 million hectares.
Read full article here
Feed Industry Optimistic About 2022 Despite Challenges
The North American animal feed industry is addressing climate change and sustainability while also facing challenges including high ingredient prices, supply chain disruptions and labor shortages, and ramping up its foreign animal disease (FAD) prevention and preparedness measures.
Despite all of these headwinds, experts are optimistic about animal feed production in 2022.
Climate change and sustainability will be on the minds of producers this year, but a slow regulatory approval process could hamper some advancements in innovation, experts say.
The concept of feed ingredients that have environmental benefits is gaining traction with consumers and policymakers, said Leah Wilkinson, vice president of public policy and education at the American Feed Industry Association (AFIA). She cited feed innovations that can reduce emissions in cattle as an example.
“Unfortunately, many of these ingredients are stuck in an antiquated regulatory review process at the Food and Drug Administration (FDA), which has resulted in the United States trailing its global competitors in bringing these products to market,” she said.
“The American Feed Industry Association is working with many agricultural stakeholders on a multipronged approach to modernize the FDA’s regulatory system so that it keeps pace with scientific innovation and that today’s farmers and ranchers can start using these technologies on their farms sooner.”
Read full article here
Eggs:
Virtual reality, but for cage-free housing designs
A five-year research grant focusing on how hens perceive and perform in cage-free environments has been approved for US$1 million.
Cage-free layer environments of the future could be far better adapted to hens’ needs, following a US$1 million grant to a Purdue University research project that seeks to understand how layer hens perceive their environment.
As state mandates continue to drive the egg industry towards cage-free environments, multiple housing designs have been marketed. However, according to Darrin Karcher, Purdue University Associate Professor of Animal Sciences, it is important to design systems based on hen perceptions, rather than on human perceptions.
Read full article here
Breaking down US avian flu cases by flock type
To date, more than 31 million birds in the United States commercial poultry industry have been lost to the highly pathogenic avian influenza (HPAI) outbreak of 2022.
That is a number that is practically unimaginable to most of us. And we need to keep in mind that these are just cases in commercial poultry and that figure does not include the backyard poultry flocks and wild birds that have also been affected by the virus.
The staff at WATT Global Media has been busy reporting the developing stories of this outbreak, and the situation changes daily.
A unique thing about this outbreak is that practically every type of poultry flock that is raised in the United States has been infected. And at the conclusion of the past week, we broke those HPAI infections down by the type of flock.
Read full article here
Egg Week
USDA Weekly Egg Price and Inventory Report, April 27th, 2022.
Market Overview
Average unit revenue for Midwest Extra-large, Large and Medium sizes were unchanged from the past week following depletion of more than 23.7 million hens including complexes in Lancaster County, PA. over the past eight weeks. The stable prices for all sizes this past week was contrasted with a 5.6 percent increase in shell-egg inventory held by Industry. This suggests adequate inventory held by chains that have replenished their retail pipelines after Easter. Continued demand is projected over the short term with stable to mildly declining prices through May. If additional cases of HPAI are diagnosed, availability will be more severely impacted especially in the breaking sector. Industry inventory increased this past week to 1.80 million cases due to the 5.6 percent increase in shell eggs contrasted with a fractional increase in breaking stock. It is possible that orders will increase over uncertainty on the part of chain buyers concerning avian influenza. Either way retailers are expected to maximize shelf prices in relation to demand. Wholesale unit prices during the 1st quarter of 2022 contrasted favorably with the corresponding periods in both 2020 and 2021 that were characterized by low ex-plant unit revenue. Wholesale Midwest prices are yielding unusually positive margins, despite the higher combined costs of nest-run, (feed, chicks, labor and fuel), grading, packaging and delivery.
Shell inventory was 5.6 percent higher after a 7.9 percent decrease during the previous week. It is now apparent that the inventory held by chains and other significant distributors may be more important in establishing wholesale price than the USDA regional inventory figures published weekly, especially over the short term. The seasonal strategy of retailers is to adjust purchases only in response to retail demand and to hold down inventories in their DCs and stores while marking up shelf margins and pressuring suppliers for rapid replenishment of stocks to DCs and through DSD. Market data suggests that chains have priced generic white eggs in response to prevailing demand and are infrequently featuring generic Large or Extra large.
Read full article here
Poultry:
Think convenience when it comes to chicken for retail
Consumers want chicken brands to create retail options that are easy to shop for and easy to prepare.
“People are looking for convenient options. For fresh chicken, you’ve got thighs, you’ve got breasts, you’ve got whole chickens. But if you go and look at the beef section, you can buy pre-cubed beef. You can buy pre-cubed pork, but you can’t buy pre-cubed chicken,” Jennifer Bartashus, senior analyst, Bloomberg Intelligence.
“Very few retailers sell rotisserie chicken that is already shredded. If somebody wants to make enchiladas, they have to debone that chicken and pull it apart themselves.”
Bartashus will explore shifts in consumer attitudes toward online and in person shopping, delivery and pickup for chicken products could change going forward, as well as consumer expectations for innovation, tastes and flavors at the 2022 Chicken Marketing Summit.
Read full article here
Broiler Month
Monthly Broiler Production and Prices, April 25th, 2022.
Chick Placements.
According to weekly Broiler Hatchery Reports covering four weeks ending on March 5th through March 26th a total of 961.80 million eggs were set, 0.5 percent more than the corresponding weeks in 2021. For the same period 746.01 million chicks were placed within one percent of the corresponding period in 2021.
A total of 176.3 million day-old chicks were placed among the 19 major broiler-producing states during the week ending March 19th. Total chick placements for the U.S. amounted to 185.7 million, 0.1 percent (0.2 million chicks) more than the week ending February 19th. Claimed average hatchability for the period approximated eighty percent for eggs set three weeks earlier Each 1.0 percent change in hatchability represents 1.9 million chicks placed per week with the current range of weekly settings.
Read full article here
Turkey:
HPAI outbreak is déjà vu for U.S. turkey industry
The avian influenza outbreak in the United States will likely wind down in May. The impacts will linger on, however, for the turkey industry.
Gone by mid-May?
Highly pathogenic avian influenza (HPAI) is present throughout the U.S. and its affecting regions known for egg, broiler and turkey growing. It’s evident the disease is spread by wild bird populations carrying it all over the continent.
Dr. Thomas Elam, president of FarmEcon LLC, said in a recent WATT Poultry Chat video he expects HPAI’s spread will abate in May 2022. The virus prefers cool water and cool weather so the warmer spring and summer temperatures should stop its spread. The same thing occurred the last time there was a major outbreak in 2015.
Read full article here
Turkey Month
Monthly Turkey Production and Prices, April 25th, 2022.
Poult Production and Placement:
The April 13th 2022 edition of the USDA Turkey Hatchery Report, issued monthly, documented 26.93 million eggs in incubators on April 1st 2022 compared to 27.00 million eggs on April 1st 2021* The April set was down 2.3 percent (0.62 million eggs) from April 2021 and 1.0 percent down from the previous month of March 2022.
A total of 23.88 million poults were hatched during March 2022 compared to 23.27 million in February 2022*. The March 2022 hatch was up 2.9 percent (0.6 million poults) from the previous month of February 2022.
A total of 22.18 million poults were placed on farms in the U.S. in March 2022, compared to 22.00 million in March 2021*. The March placement was 0.8 percent, (0.18 million poults) more than the previous month of March 2021. This suggests disposal of 1.71 million poults during the month, therefore approximately 7.1 percent of the March 2022 hatch was not placed.
Read full article here
Pork:
Disease, labor, exports top issues for US pork producers
During the spring Capitol Hill fly-in of the National Pork Producers Council (NPPC), nearly 100 producers from across the country are expected to participate — in person for the first time in two years — in NPPC’s Legislative Action Conference.
“Challenges facing our industry continue to evolve, and we hope our efforts this week help lawmakers understand why these issues are so important to the livelihoods of producers and the future of our industry,” said Terry Wolters, NPPC president and owner of Stoney Creek Farms in Pipestone, Minnesota. “But we need action now on those three matters so producers can continue providing safe, nutritious pork to consumers worldwide. The fly-in allows producers to use their voices and tell their stories to compel representatives to take swift action on these issues.”
Read full article here
USDA: ASF vaccine candidate passes important safety test
Tests show vaccine candidate does not revert to virulence, passing a ‘critical milestone’
Scientists with the U.S. Department of Agriculture’s (USDA) Agricultural Research Service (ARS) said a vaccine candidate for African swine fever (ASF) passed an important safety test required for regulatory approval, moving the vaccine one step closer to commercial availability.
The test is an important milestone as part of a series of safety studies. These new results show that USDA’s vaccine candidate does not revert to its normal virulence after being injected into swine. This “reversion to virulence” test is required to ensure that the vaccine’s weakened form of the ASF virus does not revert to its original state.
Read full article here
Beef:
Senate Ag Committee Reviews Two Cattle Market Legislative Proposals
The Senate Ag Committee today reviewed two controversial cattle market proposals — S 4030 the Cattle Price Discovery and Transparency Act of 2022 and S 3870 the Meat and Poultry Special Investigator Act of 2022. Link for details from the Senate Ag panel. (Note: This special report could be updated with additional comments and perspective.)
S 4030 would require beef packers to buy more of their cattle in “open, competitive markets.” Its proponents believe a lack of competition due to heavy concentration in the meatpacking industry is giving packers too much market power, to the detriment of both consumers and farmers and ranchers. The measure (S 4030) now has a total of 19 co-sponsors in the Senate, including nine Republicans and 10 Democrats. The legislation is being spearheaded by Sens. Chuck Grassley (R-Iowa), Deb Fischer (R-Neb.), Jon Tester (D-Mont.) and Ron Wyden (D-Ore.).
“Today’s marketplace is more consolidated than it was in 1921, when this body passed the Packers and Stockyards Act. Rural America is drying up because we can’t get fair prices at the farmgate. Capitalism isn’t working, in this particular instance, because of concentration and consolidation in the industry,” said Sen. Tester.
Meatpackers currently acquire the majority of their cattle by contracting with individual producers. The Cattle Market Transparency Act would require more public disclosure of what packers are paying for their cattle and also require the packers to buy more cattle through competitive cash markets.
Packers argue there is nothing inherently wrong with cattle markets, attributing the price changes to natural supply and demand forces and market disruptions like the pandemic.
Read full article here
Cattle on feed and continuing drought
The latest “Cattle on Feed” report showed a record April feedlot inventory of 12.1 million head, up 1.7 percent year over year. The quarterly inventory of steers on feed was up 1.8 percent year over year while the inventory of heifers on feed was up 1.7 percent over one year ago. The total inventory included 62.3 percent steers and 37.7 percent heifers. The current level of heifers on feed does not suggest heifer retention for herd expansion. For example, from 2014-2016 in the last herd expansion, the average level of heifers on feed was 33.6 percent
March placements were fractionally lower than last year, down 0.4 percent. This total was well above pre-report expectations of an eight percent decrease in placements. Once again feedlots have found cattle to place when feeder supplies are tightening. The largest increase in placements was in Nebraska, which was up 6.8 percent year over year. Placements in Kansas and Colorado were equal to last year while Texas was down 6.5 percent and Iowa was down 10.7 percent year over year.
Read full article here
Dairy:
Cargill to Expand Global Animal Nutrition Innovation Center
Cargill is spending nearly $50 million to expand and renovate its Global Animal Nutrition Innovation Center in Elk River, MN, which is 30 minutes from its global headquarters in Minneapolis.
The investment will upgrade animal facilities, including a dairy innovation unit, construct a larger onsite feed mill, add a visitor’s space, and build a laboratory for nutrient research and development.
A groundbreaking was held April 19, with the updated facility expected to open in spring 2023.
Designed to serve dairy, poultry, swine and aqua nutrition customers and the testing needs of other Cargill businesses, the Global Innovation Center hosts more than 2,000 visitors a year. In addition, new viewing corridors will allow visitors to view the animal R&D facilities.
Read full article here
U.S. dairy industry calls for action on supply chain relief
The U.S. Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF) recently sent a letter to the Biden administration recommending specific steps to provide relief and support to dairy farmers and exporters facing supply chain constraints.
The letter to Agriculture Secretary Tom Vilsack and Transportation Secretary Pete Buttigieg called for interagency collaboration to enhance capacity at ports, incentivize carriers to load export cargo, and improve transparency throughout the supply chain. The lead recommendation called for USDA’s Agriculture Marketing Service (AMS) to restart its Ocean Shipping Container Availability Report (OSCAR).
“Supply chain challenges have cost U.S. dairy exporters over $1.5 billion last year alone. We thank Secretaries Vilsack and Buttigieg for their advocacy for America’s agriculture exporters in the face of significant supply chain constraints. We are incredibly grateful for the administration’s ongoing efforts and creative solutions, particularly for the development of ‘pop-up’ sites for agricultural exporters to source empty containers,” said Krysta Harden, president and chief executive officer of USDEC.
Read full article here
Miscellaneous:
War in Ukraine will have long-term effects on US ag sector
The U.S. grain sector is benefitting from Russia’s and Ukraine’s inability to export, according to a new quarterly report from CoBank.
“Agricultural commodity prices have more or less kept pace with input cost hikes, incentivizing producers to expand their operations despite record high costs. U.S. grain production will be critical for supplying the world as Ukraine struggles to plant, harvest and ship its corn, wheat and sunflower seed,” the report said.
Read full article here
Cybersecurity issues need industry attention, Viva Fresh speaker says
Cybersecurity is an ag issue now, and that real and present threat should spark industrywide attention to the issue, Greg Gatzke, president of Zag Technical Services, said on April 22 at the Viva Fresh Expo.
Cyber attacks are increasingly common, and the FBI on April 20 warned agriculture businesses about ransomware attacks on agricultural cooperatives potentially timed to critical planting and harvest seasons. The attacks, the FBI said, are “disrupting operations, causing financial loss and negatively impacting the food supply chain.”
“Cyber threat actors will continue to exploit network, system and application vulnerabilities within the food and agriculture sector,” the FBI notice said.
Gatzke echoed some of the themes of FBI communication.
Read full article here
Food prices expected to increase near 6% in 2022
Back in January USDA Economist Matthew MacLachlan was forecasting that retail food price inflation this year would finally cool down from the 3.5% increases in 2020, and also in 2021, and was projecting food price hikes this year would run only between 1.5 and 2.5%.
Those projections four months ago are far removed from the April forecast for 2022 food prices.
“For all food, we’re looking at price increases between 5 and 6%. For food at home, we’re also looking at a 5 to 6% price increase. For food away from home, we did not adjust this past month, and is projected to be between 5.5 and 6.5%,” Maclachlan says.
Read full article here
The information in this newsletter is intended to update our readers of current events. Any third-party publications are presented for informational purposes only and the views presented in such publications are those of the respective authors. The views therein are not necessarily representative of Aeros or any other CULTURA company’s views on any particular topic.