Maro Ibarburu, program manager for the Egg Industry Center located at Iowa State University released the May-June Statistical Report on July 1.
The current report is summarized for readers of Egg Industry.
- The U.S. estimated cost of production for June 2010 was 57.0 cents per dozen ex farm, 0.8 cents per dozen less than the previous month. The six-month average production cost for 2010 attained 58.4 cents per dozen, 1.9 cents per dozen (3.2%) less than the 59.7 cents per dozen recorded during the first six months of 2009.
- The June ex farm egg price estimated by the USDA-NASS was 42.2 cents per dozen, compared to 38.6 cents per dozen for May 2010 and a six-month average of 70.0 cents per dozen for 2010 to date.
- The margin represented by “income minus cost” for June was -14.8 cents per dozen continuing the negative trend from May at -12.5 cents per dozen. For the first six months of 2010 the average margin was 12.2 cents per dozen. The June margin was 10.3 cents per dozen below the equivalent value in June 2010.
- In evaluating the low margin for June it was noted that feed cost was 33.8 cents per dozen, with pullet depreciation at 8.5 cents per dozen and other fixed and variable costs of 14.7 cents per dozen, applying the standard cost factors used by the EIC. These values remained virtually unchanged through the first six months of 2010. Contribution per hen, based on June figures remained negative at -27.3 cents per bird which followed the -26.1 cents per bird value in June. The cumulative six-month hen contribution now stands at 137.4 cents per bird.
- The Urner Barry (UB) simple average price for six U.S. regions, assuming 80% large eggs, was 44.3 cents per dozen for June compared to 45.7 cents per dozen in May 2010. The six-month simple average UB price was 69.3 cents per dozen.
- In reviewing retail prices for table eggs, the Bureau of Labor Statistics and the Department of Commerce estimated a May average of 152.3 cents per dozen, 14.3% lower than the April 2010 value of 177.9 cents per dozen but almost equivalent to the 150.1 cents per dozen recorded in May 2009. The simple average retail egg price for the first five months of 2010 was 175.7 cents per dozen.
- The large- to medium-grade white egg price spread over six regions was 17.0 cents in June compared to 10.8 cents per dozen in May with an average of 17.5 cents per dozen for the first six months of 2010. Regional spreads ranged from 14.7 cents per dozen in the Midwest to 20.0 cents per dozen in the South Central region.
- During June 2010, layer feed averaged $197.80 per ton, which is 1.4% lower than the six-month average of $200.60 per ton based on six regions. During June the price range among regions was $173.60 per ton in the Midwest rising to $219.40 per ton in California. The differential of $45.80 is equivalent to 7.8 cents per dozen applying realistic industry production parameters.
- For the first five months of 2010, commercial-pullet strain eggs in incubators have remained almost constant at 39.29 million compared to 2009. Straight run hatch for May increased by 5.7% over the corresponding month in 2009. As of May 1, egg-type pullet hatch decreased by 9.3% over April 2010 to 21.537 million.
- Projections for pullets to be housed in future months based on the five months-previous hatch and incorporating a 5% mortality factor, include a range in the increase in placements from 15.75 million pullets in April to 21.44 million pullets in September 2010. The 10-month average of 18.2 million pullets per month for 2010 is 6.3% greater (1.11 million pullets) than the 10-month average of 17.11 million per month for 2009. The 2005 to 2009 monthly average was 16.6 million pullets placed each month.
- For May 2010, the USDA-NASS estimated the national flock at 279.2 million hens, which is 1.9 million less than in April 2010, following historical trends but 0.8 million less than in May 2009. Applying the University of California model based on USDA-NASS data for chickens and eggs, it is estimated that the October 2010 flock will attain 219.7 million hens aged less than 72 weeks.
- This incorporates the assumption of 9% mortality from 20 through 72 weeks of age. As at the end of May 2010, 23.7% of the national flock was over 72 weeks of age. With the exception of March 2010, which was an aberration, the seasonal pattern of a decline in molted flocks from January through April appears to be holding. For the entire year of 2008, 31.7% of the national flock was over 72 weeks of age.
- Six regions reported a simple average of 24.1% molted hens in June 2010 reflecting all states surveyed by the USDA-NASS. The actual proportion of molted hens in the U.S. varies widely, from 9.3% in the Northeast to 36.0% in California. The six-month average of 23.4% molted hens in the U.S. flock and differences among regions reflect production costs, revenue for eggs and realization value for spent hens.
- The most recent estimate of the national table-egg flock for July 2010 is 278.9 million hens. This number is expected to increase steadily through 287.3 million in September to 291.8 million in December and January. Given current projections of prices which are functions of supply and demand, flock sizes could be trimmed by depletion or increased by retention or molting subject to available capacity including re-caging. Prolonged depression in price beyond current estimates will inevitably result in a decrease in hen numbers since flocks will be depleted at a rate faster than projected.
- The EIC projects an Urner-Barry Large Midwest price of 84.8 cents/dozen for July with prices in November and December attaining approximately 110.0 cents per dozen. The post-January drop will occur in 2011 with April and May forecast to be 89.6 and 76.4 cents per dozen respectively. The future prices forecast in June have been reduced by approximately 10 cents per dozen in comparison to projections published in May.
- The top six states representing 157.97 million hens represent 57.5% of the total national flock. In descending order these states are Iowa (19.4% of total), Ohio (9.7%), Indiana (8.2%), Pennsylvania (8.2%), California (6.9%), and Texas (4.9%). States reporting to the USDA-NASS represent 99.1% of all hens producing table eggs.
- Rate of lay for the first five months of 2010 attained 76.1%. This is higher than in 2009 during which an average of 75.1% was recorded. The positive difference of 1.0% in production level is equivalent to a daily volume approaching 7,800 cases.
- During May 2010, 5.73 million cases of eggs were broken under Federal inspection, which is approximately the same as the previous month but 1.8% more than in May 2009. For the first five months of 2010, egg breaking was up by 1.4% over the corresponding period in 2009. For the year to date, 30.4% of the 89.7 million cases produced have been broken compared to 30.8% for the entire year of 2009. It is noted that the proportion of eggs broken has steadily declined from the 2005 high of 35.1% to a projected value of 30% for 2010.
- The revised egg consumption value for 2010 is projected to be 247.1 per capita, almost 0.3%, lower than the 247.9 eggs per capita recorded in 2009. Over the past seven years the highest per capita consumption of 257.8 eggs was recorded in 2006.
- According to the USDA Foreign Agricultural Service, 618,000 cases of shell eggs were exported during the first four months of 2010 with Hong Kong (35% of export volume), Canada (24%) and China (6%) representing the most significant importers. Shipments of shell eggs for the first four months of 2010 represented 1.1% of U.S. production.
- Exports of egg products and shell equivalents represented 1,461,000 cases for the first four months of 2010, equivalent to an average of 2.03% of U.S. production.
- Combining shell eggs and egg products, total exports during the first four months of 2010 represented the equivalent of 2.03 million cases or 3.1% of U.S. production.