River

Bird flu sounds bad, but poultry production still increasing

Poultry and pork increases will more than offset decreases in beef poundage to boost total 2015 meat production.

Total meat output may grow this year despite the avian influenza outbreak, according to Derrell Peel, Oklahoma State University extension livestock marketing specialist.

Related: Avian flu timeline: A recap of HPAI headlines

USDA Animal and Plant Health Inspection Service reports nearly 34 million birds already have been depopulated as a result of avian flu. The majority of these are laying hens, followed by turkeys, with relatively few broilers at this point.

Because of this breakdown, the biggest and most immediate impact for consumers is in egg markets, especially in the north-central part of the country.

Limited impact on broilers: The majority of bird flu-affected poultry is layers, followed by turkeys.

While consumers will be impacted directly, the impact of avian flu on poultry meat supply is minimal and likely to remain that way, Peel says.  

The current depopulation total of 33.8 million birds is equal to only 0.38% of the 2014 poultry slaughter total of 8.9 billion birds. As bad as it is, it is very unlikely that enough birds will be slaughtered to impact domestic poultry production significantly.

Related: How bird flu may impact consumers' poultry purchasing plans

Even for turkeys, Peel says, which only represent 2.7% of total poultry slaughter, the current turkey depopulation represents less than 3% of 2014 US turkey slaughter. Both broiler and turkey production are still expected to surpass year ago totals unless the outbreak expands significantly.

"While the direct loss of birds is unlikely to materially impact total poultry production, the impact on domestic consumption is more likely to be significant and is counterintuitive," Peel says.

Bird flu impact on meat markets
He explains that the biggest impact of avian influenza on meat markets is the closure of poultry export markets. In 2014, 8.2 billion pounds of poultry were exported from the U.S., which is 18.2% of the 45 billion pounds of total poultry production. Both broiler and turkey exports, already struggling in 2015, are forecast to decrease even more in 2015 as result of the outbreak.

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He adds that broiler exports are expected to be down roughly 9%, though the situation is very dynamic and the impact could get larger or smaller, depending what happens with the influenza outbreak as it develops.

Related: 2015 bird flu outbreak largest in U.S. history

Either way, Peel says decreased broiler exports will add to already expanding broiler production and that will result in more domestic consumption of broilers. The anticipated 5.2% year-over-year increase in broiler production, when augmented with decreased broiler exports, is likely to push domestic broiler consumption up by roughly 6.5%, instead.

Increased broiler production will combine with an expected 6.7% increase in pork production over 2014 levels.

That should push total 2015 U.S. meat and poultry production up by 3.5%, Peel says, despite a projected decrease in beef production 1-2% from 2014 to 2015.

He adds that per capita beef consumption may show a slight year-over-year increase in 2015 because of increased beef imports and decreased beef exports.

Add this all together and it looks likely total domestic red meat and poultry consumption in 2015 will increase by 4.2% compared to 2014 levels.

TAGS: Regulatory
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