Poultry and egg situation

UNITED STATES DEPARTMENT OF AGRICULTURE
Bureau of Agricultural Economics
Washington

PES-5 May 8, 1937


THE P 0 ULTR Y AIT D EG G SI TUATI 0




The Bureau of Agricultural Economics reports the following as inpo'.'rtnl

developments in the poultry and e-gg situation in April: (l) the continued

greater-than-seasonal rise in the farm price of chickens, (2) the growing

evidence of a large carry-over storage stocl: of frozen poultry by July 1,

(3) the decline in market egg prices, and (4) the continued increase of storage

stocks of eggs above those of 1936.

The rise in farm prices of chickens, in the face of heavy receipts of

poultry and large storage stocks, may be attributed largely to a stronger

consumer demand for poultry than has existed in recent years. While a con-

tinuance of this improved demand would tend to lessen the extent of the usual

seasonal price decline in the last hc.lf of the year, its effect may be off-

set to some extent by a larger-than-usual summnner stock of frozen poultry.

Eggs are continuing into storage at a rate about 26 percent greater

than last year. This heavier storage movement began under the stimulus of

stronger storage demand; it continues now largely because of relatively low

consumption. While slight reductions in farm egg prices may occur this spring,

this larger storage stock will tend to keep egg prices in the last half of

1937 from advancing by as much as the average seasonal amount.

In the first half of 1938, however, when the storage stock is used up

and the 1937 crop of pullets will provide the important source of supply, egg

-prices are likely to exceed those of 1937.










Feed situation

The fedd situation in April, as judged by the Chicago feed-egg ration,
was more u'nfravorable to the poultryman than inr any other month of record. The
rise in the feed-egg ratio was due both to a rise in feed prices and to a de-
cline in the market price of eggs.


The feed-egg ratio at Chicago, by weeks, average 1925-34, annual 1935-37

(Dozens of eggs required to buy 100 pounds of poultry ration) ---
Week ended as of 1937
Year : Iar.: Mar.: Mar.: Mar.: Apr.: Apr.: Apr.: Apr.: May : June: July
: 6 : 13 : 20 : 27 : 3 : 10 : 17 : 24 : 1 : 5 : 3
:Dozen Dozen Dozen Dozen Dozen Dozen Dozen Dozen Dozen Dozen Dozen
Average
1925-34 .......: 6.20 6.16 6.14 6.13 6.23 6.31 6.49 6.46 6.43 6.98 6.71

1935 ...........: 7.30 7.27 7.25 7.19 7.10 6.98 6.85 7.15 6.77 6.34 6.22
1936 ..........: 5.11 6.29 6.39 6.37 6.48 6.39 6.25 6.21 6.01 5.60 6.32
1937 ...........: 9.17 S.93 8.75 9.07 9.72 10.31 10.25 10.53 10.80



In most years the feed-egg ratio rises to n maxiumu in June; note the
course of the 1925-34 average. In 1935, however, after the 1934 drought, the
ratio was greatest in March, declining l.-ter in the spring and swunmer. Tnis year,
with feed prices not expected to be maintained for long at their high April level
and with egg prices not likely to cha-nge materially during the spring, the feed-
egg ratio has probably reached its peak.

Hatcnings

As was pointed out in March, this high feed-egg ratio "would be expected
to cause a reduction in the total hatch, both farm and commercial, of 7 to 10
percent in 1937 from that of 1936.

Reports from commercial hatcheries, however, show an increase over 1936
of 14 percent in salable chicks hatched in March and an increase of 3 percent
during the period January through March. On the other hand, while official data
arc lacking, trade comments indicate that the sale of chicks was below production.

The number of young chickens in farm flocks on April 1 was 11 percent
greater than in 1936. Because weather conditions so greatly affect the number
on April 1, however, it is a poor guide to the number on June 1.


PES-5


- 2 -






Poultry marketing

Though 3 percent less than in March, receipts of" dressed poultry at the
four markets New York, Chicago, Boston and Pniladelphia in April were
greater than the lC-v reached in February. Tn,- average (1925-34) decline from
March to April is 9 percent. This situation reflects the large out-of-storage
movement. The effect of the storage movement on receipts will continue until
mid-summer. Because of this it seems likely that receipts will rise season-
ally and be above the 1925-34 average until marketing of the new .-rop of
birds is well begun. Receipts in the last part of 1937 will pretably be less
than in 1936 if the prospective reduction in the hatch materializes.

Receipts of dressed poultry at the four markets, January-June,
average 1925-34, annual 1935-37

Year Jan. Feb. : Mar. Apr. May June Jan-.-June
:Million Million Millien Million Million Million Million
poundss P20MuddL P.Ads. pounds pounz s pfi3Qds P9. -
Average
1925-34 ...: 28.5 20.? 17.0 15.4 1.6 21.0 120.7

1935 .......: 21.0 15.1 12.6 13.5 14.4 18.3 94.9
193 ...... 19.6 13.7 .. l4.2 14.5 17.9 21.7 131.6
1937 .......: 21.3 15.3 18.7 18.1


Poultry storage

It is becoming more apparent that a large carryover stock of frozen
poultry will probably exist by July 1. As has been pointed out in previous
months, the out-of-storage movement would have to be 106 million pounds in
the first 6 months of 1937 at the 26 major storing centers in order to have
about average July 1 stocks. The movement in the 4 months January through
April has been 62 percent of this total, much less than the 1925-34 average
proportion of 79 percent of the 6 months total.

Out-of-storage movement of frozen poultry at 26 markets, average
1925-34, annual 1935-37

: : __ Week enced a- f 1'q7-
Year an.-Apr. May 8 .: i' 15 May 22 a l. 29

Million million Mlillion millionn Million
poundss pounds pounds ro-.ouns potu.dis
Average
1925-34 ......: 7.9 2.8 2.2 2.2 2.0

1935 .......... : 55.9 2.2 2.5 3.0 1.6
1936 ........... 43.6 2.6 1,6 1. 3.
193.' .......... .. "5.9
Mcv:itent needed:
to clear 106 :
in 1337 ........ 83.2 3.6 6.7 6.7 6.1


PES-5


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PES-5


Note in thf. table that though the January-April out-of-storage movement
is greater in 1937 than for tht other years sho-vn, it is not nearly so great
as is necessary to clear 106 million pounds in tie first 6 months of 1937.

Thicken prices

The farm rice of chickens continued to rise by more than the usual
seasonal amount from March 15 to April 15. The April price -vas 13.4 percent
above that of January. -hnile the normal rise is 9.5 percent.

Average price per pound received fnr chi.-kens by farmers in the United
States, lP.th of the month, 1935-37

Year Jan. Feb. Mar. Apr. C May : June Oct. Dec.
: -cnts Cents Ciint .. Cents ...nts Cents Cents Cents
1935 ........... 12.4 1-)1. 114.2 15.5 15.7 15.0 15.7 16.2
1 36 ........ lo., 1 .9 16.:5 16.9 ib.6 it.14 14., 12.6
1 37 ......... : 15.4 13. 14..4 15.2

tverrge sLasonal index (avero.'ge for tne yFar 100)
Average
1921-30 .....: 94.9 98.3 1r0.0 103.9 1c5.9 105.7 9".5 92.2



The greate.r-than-average rise in farm prices this year is largely due
to the strong consumer -'emrnd for poultry. This demand is probably a result
cf the improvement in national income anid of the relatively higher prices and
loter supplies of other meats. Demand, therefore, may be expected to c-ntinue
strong durinZ the remainder of 1937. While its effect may be to accentuate
and to extend the price rise this spring, its more important effect is likely
to be a less-than-average sr-aonal declin- in the last half of 1937; ho%. much
less will depend uprn the size of the prospective storag; carry-over this-
summer a large carry-over possibly will result in an average decline, while
with only a small carry-over there may be no decline. An unusually heavy
culling of laying flocks this sLomc-er, h.'.Ccver, would probably result in a
sliorp temporary decline at that. time. -......


Inlex of national income, excluding agri~tlt.ure... average
1925-34, annual 1935-30


Tear Jan. Feb. Mar. r.r. May: June Oct. Dec.

Average
1325-34 ..: 91.0 90.7 90.2 89.7 s9.6 89.6 3E.6 8. s

1935 ......: 73.5 75.5 74.4 72.3 74.4 73.8 74.3 79.9
1936 ......: 78.6 78.5 81.6 78.7 92.'2 53.3 S7.3 97.2
1337 ......: 7.8 88.8 5.--- ........... .......





- I;.-


Laying flock size

The number of hens and pullets of la,0ing --'c in fnrm flocks averaged 3.6
percent more on Anril 1, 1S37, than a y'c-r ea.rlier. The size of the flock usually
declirLes scasonplly from ncak on Jrnu..ry 1 to a lo.', about 25 percent less, on
September 1. The decline to April h"s been 8 percent, as comnpred with the
1925-34 av.ern.-e decline for this ecrioe of 6.3 Do.rcenr*. The o:.int of interest
is that while the decline ras greater than .ver" e from January 1 to Uarch 1,
because of hervy culling, the decline in i.:-rch Wi3vs less th-.n average. It is not
likely, hoevevr, th,-.t thir- change -n sensonil movement will be mrnint'incr. in the
face of the more unfavorable feud-c:-; ratio of April a.nd of the higher poultry
prices.

Average number of laying hens in fnrm flocks, averr.-.e 1?92-34
annual l:-5-_ 7

1 : :
Year : Jan. 1 : Feb. 1 : l.;r. 1 : Apr. 1: Hay 1 : June 1: Oct. 1: Dec. 1
: V
: Nuibeor : Number : Fumber : number: N-umber: Number: Nul'mbcr: HIumiber
Ave rge :
1925-34 ....: 87.5 37.2 S4.7 82.0 ?. 4 73.4 70.4 81.9

1935 .........: 73.3 77.6 75.8 72.9 6.1 65. 1 65.1 76.6
1936 ......... 80 .6 79.1 7.7 74-. 70.5 66.5 66.9 78.9
1937 .........: 94.2 82.5 1] 80.0 77.5

I/ Re-.ised from last month.

Rate of er production

The rate of egg production reported on April 1 va-s 3.5 percent below the
rate n year before but exactly the same ns the 1925-34 aver-ge. It is likely
that the high feed-e-- rutio will keep the rate of production in the spring
months ner.r the corresponding 1925-.34 average.

Eggs laid -Ter 100 hens .nd pullets of laying age in farm flocks,-
vera e 1925-34, nn.n--.sal 1935-37


Year : Jan. 1 : Feb. 1 : Mar. 1 : Apr. 1: Mr.y 1 :June 1:0ct. 1 : Dec. 1

: Fmnber : Number : Number :ihumber :Nxmber :Number: Number: INu Iber


Average
1925-34 ....:

1935 ..........:
1936 ......... :
1937 ......... :


16.5

16.9
19.1
22.0


24.2 38.4


31.7
24.0
25. 7


37.3
32.6
39.2


52.8 55.1 49.5 25.0 13.9


53.9
54.7
52.8


55.2 50.3 25.9 16.3
56.5 51.2 25.1 16.0








Ezg mark tins

?.Receipts of egZs at the four markets in April were 17 -ercent below the
April 1I25-24 averq e. The sensonnl increase over 1.4arch vas 24 percent; in
192:=-34 it av'cr-1:ed S0 percent. Ubile less-than-average increase in early
spring often indicates a less-thn-nverae decrease in late spring (as was true
last year), this is not likely to be the case in 1937 inasmuch as the present
unfavorable feed-e.g ratio will tend to prevent more than in avera-e seasonal


aRvance in the rate of production. Receipts of eg-s in May
therefore, likely to exceed the receipts of a ye-r before.


and June are not,


Receipts of ej gs at four markets, average 1925-34, annual 1935-37

: : : :
Year : J.n.-Mar. : Apr. : May June : Apr,-June

: 1,000 1,0ooo 1,0O 1,000 1,000
: cases cases cases cases cases
Ave rage
192-.:- ....... 3,566 2,291 32,210 1,684 6,185

1335 ............: 2,991 1,779 1,871 1,429 5,079
1936 ............: 3,249 1,922 2,003 1,646 5,571
1937 ............: 3,392 1,394


E;, stora-e stocks

The into-storage movement of shell ea s in M!!rch and Aoril has been 26
percent greater than last year, as mens'ired at 26 markets. It was pointed out
last month thpt, on the basis of onst relationships -ith receipts, an increase
of about 2.3 percent in Dperm stocks cn Aujust 1 was likely. It is -robable that
recei-ts at the four markets Li.ring II-rch-June will not equal the estimate used
in last month's analysis, but, on the other hand, current consumption apparently
is not bein- maintained nt the anticipated level.

Col' stora-e holdin-s of ei-s at 26 markets, average 1925-34,
annual 1935-37

Week ended as of 1937
Year : Feb.: Apr. :Apr. : Apr.: Apr.: May : ay : May May : May
: 27 : 3 : 10 : 17 : 24: 1 : 8 : 15 : 22 : 29
:1,CGO 1,G00 1,000 1,000 1,000 1,000 1,0.0 1,000 1,000 1,000
:cases crses cases cases cases cases cases cases cases cases
Average
192.5-.4 ..: 90 1,069 1,530 2,033 2,537 3,163 3,694 4,206 4,668 5,089

1935 ....... : 31 1,199 1,525 1,857 2,216 2,598 2,969 3,397 3,742 4,106
1936 ....... : 5 610 897 1,271 1,642 2,043 2,477 2,938 3,377 3,787
1937 .......: 219 953 1,309 1,748 2,245 2,783


/*' .


PES-5


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PES-5
Egg prices


Tne farm price of eggs changed little
though market prices declined during April.
in farm prices is reached in either March or


from March 15 to April 15,
In most years the low point
April.


Average price of eggs per dozen, mixed colors, special packed
at New York, and the United States farm price, 1935-37


Year and price Jan.

: Cents


N.Y. price:
1935
1936
1937
U.S.fanM price:
1935
1936
1937


*
:
:
*


32.9
27.9
26.5


' Feb.
Cents

31.0
32.6
24.3


Mar.
Cents

24.1
23.5
26.0


Apr. May June Oct.
Cents Cents Cents Cents


26.6
22.8
25.0


Dec.
Cents


27.5 26.9 32.8 .52.3
23.9 25.1 33.5 34.3


: 25.0 25.6 18.6 20.0 21.4 21.0 27.9 28.7
: 22.8 23.8 17.5 16.8 18.1 18.9 27.6 30.5
: 23.1 20.1 19.9 20.1
: Seasonal index of farm prices (average for ear 1) ____


: 125.0 102.0 74.4


72.6 73.7 74.2 lit.9 151.2


WThile temporary declines may occur in the next 2 months they are likely
to be of temporary nature. In most years prices do not begin to rise sharply
until the end of June. December prices average about double those of June.

,ith storage stocks continuing to accumulate above last year's level
it is doubtful if the seasonal increase in farm egg prices will be as great as
average. A reduced hatch will tend to reduce fresh supplies to some extent
during the last 6 months of 1937, but it is not Vikely to completely offset
the price-depressing effect of the storage stock-.

In 1938, however, with eggs from the 1937 crop of pullets a major
source of supply, prices may be expected to exceed those of early;, 1937, if
the hatch this spring is reduced as expected. It should be noted th:t with
the flock size as .lcw now as it is relative to the 1925-34 averc -e, an
increase in the hatch is needed to replenish the nation's supply of poultry.

Supolementa.r.; Data

Average number of young chickens per farm flock


Y3ar : Apr. 1
N: umber
1927 : 43.5


1928
1929 :
1930
1931
1932
1933 :
1934
1935
1936
1937 :


-36.1
-29.2
41.7
36.6
-38.2
32.5
26.1
30.1
29.3
32.6


M'y 1
Number
104.2
88.7
87.9
107.7
84.8
83.6
39.6
76.6
84.2
89.5


June 1
Numb e r
143.8
130.2
138.3
145.7
127.3
130.6
138.7
124.4
12J.6
138.0


J ily 1
Numb er
147.1
133.1
144.7
144.0
129.3
137.5
141.5
127.0
130.3
144.4


: Oct. 1
Numbc r
94.3
85. 1
93.2
96.0
91.4
96.6
97.6
84.6
89.5
102.0


-7-


1921-30




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