Paul AhoPaul Aho, Ph.D., is owner of Poultry Perspective and economist and consultant. To contact Aho, email [email protected].From the Author - Page 2Poultry FeedA bear market for corn is inevitableCorn reached a high point of $8.44 per bushel in August of 2012, and hindsight now suggests that a bear market began at that moment. Since vicious bear markets often follow on the heels of vigorous bull markets, the poultry industry can hope or at least dream about $5 or less corn this fall. Is this dream realistic?Broilers & TurkeysUnderstanding the fundamental ethanol problemRecently, a significant portion of the unsustainable corn grain in the U.S. has been mandated to be transformed into ethanol ostensibly to reduce the use of fossil fuels. Alas, it does not.Broilers & TurkeysHigh corn prices are their own long-term cureCorn producers outside the US are coming to the rescue of the long-suffering poultry and livestock industry and being handsomely rewarded with high prices … for now.HomeWorldwide chicken, pork consumption forecast to continue increasingWorldwide chicken, pork consumption forecast to continue increasing POULTRY PERSPECTIVE Chicken consumption is predicted to increase faster than that of pork worldwide, but chicken still has decades to go before catching up to pork consumption levels. Paul Aho, Ph.D., Poultry Perspective, Storrs, CT 062HomeDeciphering droughts: What poultry producers need to knowThe last major drought in the Corn Belt was in 1988. For the next 22 years there were no significant droughts. It had been so long that many professionals in agribusiness had no memory of a drought. Then, in June, under blistering temperatures, the yield of the U.S. corn crop started to melt away. A full-scale drought developed that is a rival to 1988.HomeHigher leg quarter prices boost chicken industry profitsBaring a drought in the Corn Belt that could negatively affect the fortunes of the US chicken industry, the year 2012 (at least in the first half) turned out to be better than 2011. The entire industry returned to profitability earlier this year after a year when hardly a single plant was making money. The profitability of the first half of the year was not just a simple matter of higher chicken prices and lower grain prices. There is something else going on: The leverage provided by higher leg quarter and wing prices.HomeNumber of breeders indicates bottom of cycle for chicken industryMany have been frustrated when looking for a market cycle in the chicken industry. The short life cycle of the chicken makes it easier for the industry to turn on a dime and accelerate and decelerate production rapidly in response to market conditions. The cycles are therefore more numerous, difficult to determine and frustrating to predict. Nevertheless, there is one number that observers can hang their hat on and that is chicken breeder numbers.HomeUS boneless, skinless chicken breast industry continues to growFrom an industry that produced mostly whole and cut-up bone-in chicken in the 1980s it transformed itself into the boneless skinless breast industry. From a few hundred million pounds in 1985, production of boneless skinless breast soared to 6 billion pounds in 2010 and shows no signs of slowing down even in the face of punishingly low prices.HomeForeign crop farmers may help rescue US poultry profitabilityForeign crop farmers' response to a 200% increase in the price of corn is having a predictable effect on total world production. Next year, corn production outside the U.S. is likely to reach 600 MMT, a 100 MMT increase. The resulting impact on the world price of corn next year is predictable but might surprise U.S. crop farmers.Poultry FeedThe effects of recession and high grain costs on poultry consumption, productionThe effects of high grain costs and recession were so great that even poultry consumption dropped. Poultry consumption dropped by 2 pounds over the same period. To find a decline of similar magnitude you have to go back to the early 1970s with the oil embargo, recession and grain crisis.HomeMeat production decline undermines high corn pricesSeptember’s plunge in corn prices indicates $7 to $8 a bushel is not sustainable – for now. In September, corn on the Chicago Mercantile Exchange suffered a month-long plunge that resulted in a $2 per bushel drop from $7.80 per bushel at the beginning of the month for the December 2011 contract down to $5.80 by the end of the month.HomeThe effect of corn-ethanol on chicken versus fuelWhat if the world had to choose between having corn-based ethanol and chicken? The tradeoff is revealing.Previous PagePage 2 of 5Next Page