The year 2015 will be remembered as a remarkable one in the U.S. poultry industry. With the exception of avian influenza – which produced substantial localized losses for those in the egg industry – most market factors were favorable for broiler and turkey producers.

These factors contributed to historically high Poultry Confidence Index numbers for all of 2015. These high confidence levels have carried over into 2016.

Rise in PCI’s Overall Index

The Overall Index now stands at 133.5 for the first quarter of 2016, up from 122.8 during the fourth quarter of 2015 (100-point baseline = 1996). The Present Situation Index rose to 174.6 from 165.9, while the Expectations Index jumped to 106.1 from 94.0.

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The year 2015 saw historically high Poultry Confidence Index numbers.

Sub-indices followed a similar pattern. Three of these sub-indices rose since last quarter – Present Conditions, Future Conditions and Future Profits. Present Opportunities and Future Opportunities were virtually unchanged over this time period.

Findings from the Poultry Confidence Index paralleled those of the Consumer Confidence Index. Lynn Franco, director of economic indicators at the Conference Board, said, “Consumers’ assessment of current conditions held steady, while their expectations for the next six months improved moderately. For now, consumers do not foresee the volatility in financial markets as having a negative impact on the economy.”

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Favorable market factors have contributed to positive profit expectations.

Expectations for stable, low feed and fuel costs

Future Conditions were driven higher by expectations that fuel and feed costs would remain relatively low while the summer outdoor season would elicit higher demand. In addition, many expect favorable poultry meat prices to continue given modest supply projections. The U.S. Department of Agriculture (USDA) recently predicted a modest 2.2 percent rise in U.S. broiler production for 2016.

These favorable market factors contributed to positive profit expectations for the next six months. Good bird health also enhanced the first-quarter 2016 rosy outlook, especially with avian influenza concerns on the decline.

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Confidence in the broiler and turkey sectors is expected to continue.

Finally, several respondents noted substantial facility and personnel expansion in their respective areas. Companies typically expand or upgrade their base of operations during favorable economic periods. Poultry integrators are no exception.

In sum, optimism in the poultry industry continues to grow based on favorable market conditions now and into near future. Concerns over avian influenza seem to be rapidly fading. As was 2015, the calendar year 2016 is shaping up to be a good year for poultry!