WEEKLY ECONOMY, COMMODITY & ENERGY REPORT: December 27^th 2024.

OVERVIEW

The CME price of corn for March delivery was up 3.7 percent compared to the quotation last week. Soybeans were up 0.6 percent and soybean meal up a disproportionate 8.0. Corn and soybean prices were influenced by domestic demand and firmer projections of crop size from sequential harvests in Brazil and Argentine. There was minimal response to the December WASDE Report incorporating actual harvest values. Farmers should now have sold the remainder of the old crop to make room for the completed 2024 harvest and are actively selling the new crop to avoid further declines in price despite rises this past week. There was some technical selling arising from geopolitical concerns and in response to revised projections for harvests in South America. Contributory pricing factors included ongoing disruption in shipping in the Red Sea and Gulf of Aden, carryover from the 2023 U.S. crop, export orders and the predicted ending stocks of corn and soybeans from the 2024 crop. The 2024 harvest, was in advance of the five-year average. Both crops apparently have superior condition as compared to 2023. The transition from a neutral phase to a La Nina event is underway and will intensify during the remainder of the fourth quarter but has had no effect on the 2024 harvest. The December WASDE, incorporated actual yields and harvest volumes, with USDA updates for anticipated exports, domestic use and carryover for the 2024 crop.

At 12H00 on December 26^th the CME corn quotation for March delivery was up 3.7 percent to 454 cents per bushel. Corn price was influenced by exports, acreage harvested, ethanol demand and the ending stock from the 2023 crop. Farm selling continues with a trend of declining prices despite the recent rise. USDA estimated that 44 percent of old corn stock was held on farms at the beginning of September. Export orders for the current market year have increased in response to lower prices and for some importers to avoid future tariffs. Volumes and price are indirectly influenced by wheat availability as influenced by weather affecting the Black Sea wheat and corn crops. Orders by China resumed at the end of the 2022-2023 market-year and continued through November despite an increase in the Dollar Index, adding to increased ocean freight. Total exports for the 2024-2025 market year are 25.9 percent above the corresponding weeks of the previous market year.

Soybeans were up 0.6 percent over the week for March delivery, priced at 995 cents per bushel and continuing under the 1,000-cent threshold. Low prices over past weeks are attributed to the projection of ending stock, farm selling and taking into account recent export orders and projections of availability from the 2024 U.S., Brazil and Argentine harvests. Total exports for the 2024-2025 market year are 23.3 percent higher than for the corresponding weeks of the previous market year.

Soybean meal was priced at $312 per ton for March delivery, up a noteworthy $23 per ton from last week. Price is influenced by demand coupled with a reestablished high crush volume since September restoring the processing trend to the first half of 2024. Price will fluctuate to reflect the CME price for soybeans and the depressed demand for biodiesel due to oversupply and the consequential adverse financial situation in this sector. The market previously responded to the increased 2023 crop and higher stocks together with projections for 2024 in the December WASDE Report.

On December 26^th at 13H00 EDT the price for WTI was $69.90, down $0.60, (-0.9 percent) from last week. Current price is not materially affected by uncertainties and tensions in the Middle East. Over the longer term price reflects moderate world demand for crude as economies and especially that of China have retracted, requiring central bank stimulation in late August. It is evident that U.S. production is a moderating influence on World price, attaining a record average of 13.4 million barrels per day over the third quarter with ample reserves. There was only small fluctuation in the price of WTI through December 18^th with the range during the week extending from a low of $69.80 on December 26^th up to $70.08 on December 8^th.

Ample U.S. crude production is constraining domestic and international prices. The recent decline in energy costs during the past three months contributed to deflation.

Economic data released during the past quarter (Q3 GDP; PCE, Confidence, Productivity, Employment) confirm a growing economy but with a downward trajectory in inflation. Third quarter GDP was confirmed to be 2.8 percent consistent with preliminary projections. The FOMC decided on a 25 basis point reduction in the 10-year rate on December 18^th. Federal Reserve Chair Jerome Powell indicated one or possibly two additional reductions would be considered in 2025 with the FOMC exhibiting flexibility given uncertainties with the policies of the incoming Administration. The August and September Non-farm Payrolls and labor data clearly indicated the danger of prolonging the high benchmark interest rate that was negatively impacting the U.S. economy. The Federal Reserve is now addressing employment as a priority over containing inflation supported by higher jobless claims in recent weeks.

Macroeconomic U.S. factors:-

• Most economists in academia and the private sector accept that the U.S. economy has achieved a “soft landing”. This is despite the release of the Q3 2024 increase in GDP of 2.8 percent, down from 3.0 percent in Q2 but considering trends in recent economic parameters including the ECI, CPI and PPI. Annual inflation as measured by the headline PCE declined from 8.9 percent in June 2022 to 2.1 percent in September 2024. This is in part a response to a series of 11 FOMC rate raises followed by eight pauses that curbed inflation and cooled the labor market but without precipitating evident unemployment. There is obvious stability in the bank sectors in both the U.S. and Europe. Lower energy prices are contributing to deflation.
• The Federal Reserve lowered the benchmark interest rate by 0.25 percent at the December 18^th. FOMC meeting. Previously the benchmark was lowered by 0.5 percent at the FOMC meeting on September 18^th, the first of a series of actions after eighth sequential pauses. The Fed lowered the rate by a further 25 basis points on November 7^th as anticipated. Chairman Powell in Congressional testimony, and at the post-meeting press conference and also documented in FOMC minutes indicated that future decisions would be based on demonstrated progress in reducing inflation and confirmed by a basket of key economic data, towards an annual 2.0 percent target sometime in late 2025 or early 2026.
• The December 19^th release by the Bureau of Economic Affairs documented Q3 2024 GDP at 3.1 percent upgrading the preliminary figure of 2.8 percent. The Q3 GDP compares to 3.0 percent for Q2 and 2.9 percent for entire 2023. The GDP in Q3 was supported by increased exports and higher consumer spending, especially on non-durable goods.
• The December 11^th release of the Consumer Price Index (CPI) for November showed a 0.3 percent rise over October and an annual increase of 2.7 percent consistent with prior estimates. The annual value is compared to 2.6 percent for the 12 months preceding October. Core CPI (excluding food and fuel) was up 0.3 percent in October with an annual increase of 3.3 percent, unchanged from October. Food at home was up 0.1 percent for October and 1.1 percent over 12 months. In reviewing annual values, the category of Shelter was up 4.7 percent. Food Away from Home was up 3.6 percent, accounting for half of the inflation during the year. Among the Food components, Meat, Fish and Eggs were up 3.8 percent compared to cereals down 0.5 percent and diary up 1.2 percent. Notwithstanding the increase in CPI during November a reduction in benchmark interest rate is anticipated at the December FOMC Meeting.
• On December 20^th the Bureau of Economic Analysis released the Personal Consumption and Expenditure Price Index for November. The core PCE (excluding food and energy) was up 0.1 percent from the previous month, and attained 2.4 percent year-over-year. The Headline PCE was up 0.1 percent from November and 2.8 percent from November 2023, a 43-month low and consistent with projections. Food and energy were up 0.2 percent from October. Food was up 2.4 percent over 12-months The headline PCE is closely followed by the Federal Reserve and confirms that inflation is progressively moderating but still above an annual target of 2.0 percent.
• The November Producer Price Index for Final Demand (PPI) released on December 12^th rose 0.4 percent from October above an expectation of 0.2 percent. This was attributed in part to a 0.7 percent increase in the Goods category. Food was up 3.1 percent due to rises in meat, poultry and eggs collectively amounting to 2.6 percent over the year and a 0.3 percent increase in food. The PPI was up 3.0 percent over the past 12-months ending in November compared with 2.4 percent for the 12-month period through October. This is compared to a 6.4 percent increase in 2022. The core PPI value excluding volatile fuel and food, was up 0.2 percent from October and 3.5 percent over the previous 12 months.
• A Federal Reserve release on December 17^th confirmed that industrial production was lower by 0.1 percent in November less than the decrease of 0.3 percent in October. Capacity utilization was lower at 76.8 percent compared to 77.1 percent for the previous month and was 2.9 percent below the long run 1972-2020 average.
• The November 27^th report by the Department of Commerce, Census Bureau on Durable Goods Ordered during October 2024, orders increased by 2.5 from the previous month. Shipments were up 1.8 percent. Excluding the Transportation component, new orders in November increased by 0.1 percent. Excluding the Defense category new orders were up by 0.4 percent compared to October.
• In a December 4^th release the Census Bureau confirmed that factory orders for U.S. manufactured goods increased 0.2 percent in October and compared to a revised fall of 0.5percent in September. Shipments of manufactured goods were up 0.2 percent in October.
• The November 15^thS. Census Bureau release of the advanced estimate of retail and food sales data for October was up 0.4 percent from the revised September value of a 0.8 percent increase and up 2.8 percent over 12 months. Food service sales were up 0.1 percent from September and up 2.7 percent over 12 months. Grocery store sales were up 0.1 percent from the revised September value ($75,793 million) and up 2.5 percent over the past 12-months. The Federal Reserve FOMC closely monitors retail sales as a measure of the trend in inflation.
• The December 2^nd release by the Institute for Supply Management (ISM®) reported a higher Manufacturing Index for November at 48.4 compared to the October value of value of 46.5. The November value was still below the bifurcation point of 50 percent between contraction and expansion. The November Prices Index rose to 50.3 points in November compared to 54.8 points in October, denoting lower values for goods produced. U.S manufacturing now reflects an improved economy, with manufacturing recovering from prolonged high benchmark interest rates. The November Production Index was 46.8 points compared to 46.2 in October.
• On October 31^st the U.S. Bureau of Labor Statistics reported a 0.8 percent increase in the Employment Cost Index (ECI) over the 3^rd quarter of 2024. The year-over-year increase in wages and salaries was 3.9 percent and with benefit costs up by 5.8 percent. The ECI is closely followed by the Federal Reserve FOMC and this data justified in part the 50 basis point drop in the benchmark interest rate in September and strengthens the possibility of additional rate cuts.
• The December 23^rd Consumer Confidence Report prepared by The Conference Board for December, recorded a substantial decline to 104.7 from the revised November value of 112.8, with all segments down. The Present Situation Index measuring perceptions of current business conditions fell 1.2 points to 140.2 in November. The Expectations Index declined 12.6 points from a revised November value to 81.1. Values below this threshold over consecutive months and with a downward trajectory are regarded as predicting a recession.
• The December 20^th University of Michigan Index of Consumer Sentiment for November rose to 74.0 from the final November value of 71.8 and is compared with a value of 69.7 in December 2023. The Current Economic Index was 75.1 in December, up from 63.9 in November. The Index of Consumer Expectations was 73.3 down from 76.9 in November, denoting a deterioration in consumer sentiment despite three consecutive cuts in the benchmark rate amounting to 100 basis points and with lower inflation. Geopolitical factors and uncertainty over the economic policies of the incoming Administration have influenced sentiment in divergent directions depending on political persuasion. In perspective sentiment is 6.2 percent above December 2023.
• Non-farm payrolls added 227,000 positions in November, as documented by the Bureau of Labor Statistics in a December 6^th This was up 191,000 from the revised October value of 36,000 impacted by Hurricanes and strikes. The unemployment rate increased to 4.2 with 7.1 million unemployed and with 1.7 million in the long-term category. The real average hourly earnings value for all employees in during November was $30.57. Average hours worked for all employees was unchanged at 34.3 hours per week. Labor participation was at 62.5 percent, 0.1 percent lower than October. Wage rates increased 4.0 percent over 12-months. Wage rates are closely followed by the Federal Reserve FOMC.
• The Bureau of Labor Statistics Job Openings and Labor Survey report (“JOLTS) released on December 3^rd estimated 7.744 million job openings at the end of October, up by 372,000 from the revised September value of 7.372 and above the forecast of 7.480 million. The October job openings number was up 5.2 percent over 12 months. The peak job openings figure was 12.2 million in March 2022 during COVID. The October hiring rate was 3.3 percent (5.3 million hires); the October total separation rate was 3.3 percent (5.3 million); the quit rate 2.1 percent (3.3 million); and the layoff rate 1.0 percent, down 0.1 percent from September at 1.6 million.
• The seasonally adjusted initial jobless claims figure of 219,000 released on December 26^th for the week ending December 21^st was down by 1,000 from the value of 220,000 for the previous week and the lowest value since May. The weekly value was lower than the WSJ estimate of 223,000. The four-week moving average rose to 225,500. The Bureau of Labor Statistics estimated 1.910 million continuing claims for the week ending December 13^th (up 46,000 from the revised value for last week), and compared to a peak on November 27^th 2021 at 1.93 million. The November unemployment rate advanced to 4.2 percent. There is clear evidence from data over the past three months that the labor market is cooling as confirmed by Chairman Powell in Congressional testimony and release of downward revised figures for job creation. The jobs market is still tight, but with sporadic weekly fluctuation in new claims due to weather, strikes or scheduled plant shutdowns.
• The December 10^th Bureau of Labor Statistics report confirmed the 2.2 percent increase in non-Farm Productivity for Q3 2024. Labor cost increased by 1.9 percent compared to 0.9 percent for Q2 2024. Output was up by 3.5 percent.
• The ADP® reported on December 4^th that private (excluding government data) payrolls decreased to an unexpected 146,000 in November, down 42,000 from the revised 188,000 in October and compared to a consensus estimate of 166,000 jobs. This confirmed a slowing in the labor market withy employers reluctant to hire new workers and staff. The increase in employment was mostly in the service-related sectors with +15,000 positions. Individual categories included the Transportation, Trade and Utilities sector, (+28,000); Construction, (+30,000); Hospitality, (15,000); and Professional and Business Services, (+18,000); Information (+4,000). Manufacturing was down -26,000. Annual pay was up 4.8 percent year-over-year for ‘job-stayers’. The increase as reported by ADP will not directly influence the probability of short-term future changes in interest rate since the number, although based on 25 million positions, excludes the public sector. Monthly ADP data is regarded as less reliable by the FOMC than the Bureau of Labor Statistics Monthly non-farm payroll report.

STATUS OF THE 2024 CROP

As of November 15^th both the soybean and corn crops were harvested with a confirmation of yields and volume as incorporated in the December 10^th WASDE Report

December WASDE #655 confirmed:-

• Corn area planted for all purposes in 2024 (‘new crop’) attained 90.7 million acres. According to the November WASDE, yield was projected at 183.1 bushels per acre with a resulting record production of 15,143 million bushels with 1,738 million bushels as ending stock. The USDA held the average ex-farm price at 410 cents per bushel for the 2024 crop.
• Soybean area planted in 2024 attained 87.1 million acres. According to the December WASDE, yield was estimated at 51.7 bushels per acre with production of 4,462 million bushels with 470 million bushels as ending stock. The USDA reduced the average season price to 1,020 cents per bushel.
• Crushers are expected to produce 56.75 million tons of soybean meal in 2024. Ending stocks will attain 450,000 tons. The USDA reduced the average season price at $300 per ton.

The preference for planting soybeans in 2024 was based on a favorable projection of the soy to corn benefit ratio despite lower prospects for exports but with higher domestic demand for crushing.

USDA Weekly Egg Price and Inventory Report, December 26^th 2024.

Market Overview

• The average wholesale unit revenue values for Midwest Extra-large and Large sizes were up a substantial 23.0 percent on average this past week. Medium size was up 7.2 percent. The 5-day rolling National wholesale price for graded loose on December 20^th was $4.07 per dozen up $0.07 per dozen (+1.7 percent) from $4.01 last week. This value was approximately $1.57 above the 3-year average of $2.50 per dozen and $2.40 above the corresponding week in 2023 at $1.67 per dozen. This past week shell egg inventory was down 5.0 percent, compared to a fall of 3.0 percent during the previous week. Over the past week the NYC wholesale price in cartons was 16.9 percent higher but with the immediate prospect of a plateau during the current week based on daily increases. The fall in inventory with a large increase in wholesale price last week denotes a sharp seasonal surge in consumer demand relative to diminished supply. Fluctuation in inventory and price will occur through December based on the frequency and magnitude of orders by chains leading up to and beyond the Christmas surge and complicated by incident cases of HPAI. Relatively higher prices compared to 2023 are attributed to ongoing 2024 losses due to HPAI reducing the national flock by a conservative estimate of 14 million hens at the present time, (with some depletions in progress) concurrent with high seasonal consumer and institutional demand.
• Although there are predetermined weekly transfers of mature pullet flocks to laying houses, the size of the producing flock is constrained by depopulation due to HPAI. Year-to-date losses have attained approximately 31 million hens with the fall wave in progress.
• This past week, chains apparently widened the spread between delivered cost and shelf price. The reoccurrence of HPAI has probably created concern among chain buyers as they may previously have been reticent to place orders even with moderating prices notwithstanding the need to ensure adequate stock levels to meet demand. Inventory levels this week reflected constant re-ordering to fill the pipeline into the Christmas surge. Discounters are raising prices on generics influencing mainstream retail stores. Eggs are now less competitive in price against the comparable costs for other protein foods, and have recently been highlighted as a contributor to the prevailing perception among consumers of ongoing food inflation.
• Total industry inventory was down by 4.6 percent overall this past week to 1.45 million cases including a 3.0 percent decrease in breaking stock, following a 0.3 percent fall during the preceding week.
• It is apparent that the inventory held by chains and other significant distributors may be more important on a weekly basis in establishing wholesale price compared to the USDA regional weekly inventory figures. Changes in stock held by DCs and through the pipeline as determined by orders is probably responsible for up to three percent cyclic fluctuation in weekly industry stock. This is especially evident into or after a holiday weekend as evidenced by fluctuation inventory levels over the past month.
• The U.S. poultry industry has moved from a quiescent period regarding HPAI into a fall upsurge with incident cases in northern Utah, southern Washington State and Oregon in October and the loss of three complexes in the Central Valley of California in November and early December. A large complex holding in excess of 4 million hens followed by a second 1.6 million complex were depopulated in Sioux County, Iowa . Two cases were diagnosed in non-commercial flocks in Hawaii with the presence of H5 virus in wastewater currently under investigation. California has recorded outbreaks on broiler-growing farms in four counties recently with ongoing losses in broiler and turkey growing farms. Canada has diagnosed numerous cases in The Fraser Valley of British Columbia and outbreaks in Alberta Quebec and Saskatchewan. Over 850 confirmed cases of bovine influenza-H5N1 have been diagnosed in dairy herds in fifteen states since March 2024 with most having recovered. More than 680 herds were diagnosed in California over the past three months with the incidence rate a function of mandatory surveillance of bulk milk. Bovine influenza-H5N1 is a cause for concern since extension to laying flocks has presumably occurred in Michigan, Colorado, California and Utah. More surveillance information should be released by USDA-APHIS as it becomes available, concerning the prevalence rate of avian carriers of H5N1 among resident domestic and migratory free-living birds. This data should be correlated with a review of molecular and field epidemiology for the past spring outbreaks in order to respond appropriately to the fall wave of HPAI in progress. The USDA has yet to identify and release specific modes of transmission for the 2022-2024 epornitic including an acknowledgement of the likely airborne spread from wild birds and their excreta over short distances as suggested by current research.
• The established relationship between producers and chain buyers based on a single commercial price discovery system constitutes an impediment to a free market. The benchmark price appears to amplify both downward and upward swings as evidenced over the past three years. A CME quotation based on Midwest Large, reflecting demand relative to supply would be more equitable. If feed cost is determined by CME ingredient prices then generic shell eggs should be subject to a Midwest Large quotation.
• On December 26^th the stated total flock of 312.1 million, was down by 3.3 million from last week, including about one million molted hens that will resume lay during coming weeks plus 4.5 to 5.0 million pullets scheduled to attain production to satisfy the Christmas surge in demand. Given the latest figures for depopulation in Iowa and California, and irrespective of weekly USDA figures, it is estimated that the total egg- producing flock in mid-December is approximately 14 million hens lower than the 326 million before the onset of HPAI in 2022.
• The ex-farm price for breaking stock (rounded to one cent) was up 9.7 percent to $3.03 per dozen.Checks delivered to Midwest plants were up 2.0 percent to $2.88 per dozen this past week. Prices for breaking stock generally follow the wholesale price for shell eggs but with a lag of one to two weeks that may be reduced as in the present situation with diversion to the shell market.

The Week in Review

Prices

According to the USDA Egg Market News Reports, released on December 20^th 2024, the Midwest wholesale price (rounded to one cent) for Extra-large was up 23.0 percent from last week to $5.52 per dozen. Large size was up 23.1 percent to $5.50 per dozen. Mediums were up 7.2 percent to $3.86 per dozen delivered to DCs. Continued increases are expected in the coming week followed by a post-Christmas plateau and fall into January

The stock of Medium size was down 3.8 percent, (down 21.9 percent in the Southwest Region) and the inventory of Small size was up 8.0 percent over the past week (Midwest up 130 percent) suggesting that additional pullets placed in early August for the mid-December surge in demand have commenced their production cycle. This has implications for prices during January 2025. There is increased institutional demand for Medium size and some consumers are opting for smaller eggs based on price sensitivity.

Prices should be compared to the USDA benchmark average 4-Region blended nest-run cost of 74.0 cents per dozen as determined by the Egg Industry Center based on USDA data for November 2024. This value excludes provisions for packing, packaging materials and transport, amounting to 57 cents per dozen as determined in mid-2023 from an EIC survey (with a low response) and now realistically 60 cents per dozen.

Currently producers of generic shell eggs should be operating with very strong positive margins irrespective of region and customer-supply agreements. The progression of prices for loose eggs during 2023 and 2024 to date is depicted in the USDA chart reflecting three years of data, updated weekly.

The December 23^rd edition of the USDA Egg Market News Report confirmed that the USDA Combined Region value in cartons (rounded to the nearest cent), was up 18.4 percent to $4.56 per dozen delivered to warehouses one week ago. The USDA Combined range for Large in the Midwest was $4.47 per dozen. At the high end of the range, the price in the South Central region attained $4.63 per dozen.

Flock Size 

It is questioned whether the 6.7 million hens among four complexes depopulated in California during November and December to date, the 5.8 million in Iowa, 2.0 million in California have been accounted for. Depletion of a large complex in Northwest Ohio is currently in progress. Any delay in posting accurate and updated data, during fall outbreaks, should be avoided given the importance of weekly flock numbers in pricing. Accurate and current values for the producing and total flocks are required by farmers, packers, breakers and buyers.

According to the USDA the number of producing hens reflecting December 26^th 2024 (rounded to 0.1 million) was down 4.4 million to 304.8 million suggesting that the rate of routine flock depletion and losses from HPAI is lower than the replenishment of flocks through molting and transfer of started pullets. This contention is questioned given sequential weekly losses. The total U.S. flock includes about one million molted hens due to return to production Approximately 4.5 to 5.0 million pullets on average reach maturity each week, based on USDA monthly chick-hatch data for 20-weeks previously. The increase is offset by routine flock depletion but depopulation due to HPAI continues to reduce the number of producing hens. Many flocks have been replaced on a rotational basis and routine flock depletion is delayed subject to availability of housing. Based on inventory level and prices, the population of hens producing table eggs and breaking stock should now be balanced with post-Christmas demand by consumers. Industrial and food service off-take is stable, attaining pre-COVID levels. Prices for shell eggs established a plateau in late September followed by a progressive rise through October to high seasonal levels before the pre-Thanksgiving surge but then followed by a brief decline. The seasonal increase before Christmas was evident but a post-holiday plateau may replace the seasonal decline in January 2025 since additional loss due to HPAI is anticipated.

According to the USDA the total U.S. egg-flock on December 26^th 2024 was 3.3 million lower to 312.1 million hens including a larger than normal proportion of second-cycle birds and started pullets. The difference between total and producing flocks was 7.3 million (rounded). Data for the past four weeks indicated that molted hens were resuming production. Given the season and the trajectory in benchmark wholesale prices, producers are retaining as many hens as allowed by capacity. At present it is estimated that there are approximately 14 million fewer hens in the total flock that now includes cases of HPAI that have emerged from October through to the present. The apparent difference is equivalent to about 4.3 percent of the pre-HPAI 2022 national flock of 326 million hens.

Updated December 2024 USDA Projection for U.S. Egg Production and Consumption.

On December 16^th 2024 the USDA Economic Research Service (ERS) issued actual values for egg production during 2023 with a projection for 2024 and a forecast for 2025. Production, consumption and prices were revised from the previous October 18^th 2024 report.

Projected egg production for 2024 was reduced 0.5 percent from the November 2024 Report to 7,748 million dozen This will be 1.5 percent less than in 2023 due to progressive depletion of hen flocks due to HPAI through December with incident cases reoccurring weekly. The per capita consumption of shell eggs and liquids combined for 2024 will be 273.5 eggs down 5.8 eggs (-2.1 percent) from 2023. The projected average 2024 benchmark New York bulk unit price was raised 192 cents to 300 cents per dozen above 2023.

Subsequent USDA projections will provide greater clarity on the recovery in consumption in an economy that is undergoing deflation in all food categories with the outstanding exception of eggs. The 2023 Midwest in-carton national wholesale price peaked at $5.17 per dozen on January 3^rd 2023 but fell precipitously to a market bottom of $0.78 per dozen on May 8^th 2023. Midwest Large wholesale price was restored during May 2024 and despite substantial declines during late August through September attained $3.77 per dozen for Midwest Large  in cartons delivered to DCs on December 13^th 2024. The Midwest wholesale Large value should be compared to the USDA/EIC projection of the combined nest-run November 2024 cost of 74 cents per dozen for caged white Large, plus a provision for processing, packaging and transport of 60 cents per dozen amounting to $1.34 cents per dozen.

Restoration in flock size after HPAI depletions in 2022 progressed at a rate of approximately 0.5 million per week but placements were limited by the availability of pullet chicks and in some companies the rate of conversion to alternative housing systems. Restoration of the national flock was compromised by a resurgence of HPAI with 13.0 million layers depleted during the 4^th quarter of 2023 representing 4.0 percent of the nominal producing flock of 326 million hens, mainly on complexes averaging over one million hens. Unpredictable factors affecting price will include the extent of anticipated losses during the fall migratory season that to date has claimed seven significant complexes with a total of 13 million birds. Approximately 31 million hens have been lost to HPAI year-to-date in six states. At present the national egg-producing flock is down by about 12 million hens compared to the complement of 326 million at the beginning of the 2022 epornitic.

Exports of eggs and products at approximately 2.3 percent of total production over the first ten months of 2024 did not materially affect the domestic price. Future export volume will be constrained by high domestic prices.

The USDA forecast for 2025 includes production of 7,990 million dozen, up an optimistic 3.1 percent from 2024. Projected consumption of 285 eggs per capita, would be a speculative eight egg (2.9 percent) increase over 2024, down from an incremental 11 eggs in the November USDA projection. This probably presumes substantial control of HPAI and an adequate supply of replacement chicks and pullets, both unrealistic assumptions. The increase, if it were to transpire would depress the NY Large benchmark price to an average of $2.30 per dozen over 2025.

During 2023 shell egg exports attained 89.4 million dozen, up 28.6 percent compared to 2022 when high domestic prices prevailed. Egg products were up 18.2 percent to 20,814 metric tons compared to 2022.

Over the first ten months of 2024, 69.1 million dozen shell eggs were exported valued at $159.0 million. Volume was 6.3 percent lower but value was 15.6 percent higher compared to the corresponding months in 2023 with a unit value of $2.30 per dozen, up 26.4 from the equivalent months in 2023.

Over the first ten months of 2024, 21,183 metric tons of egg products were exported valued at $95.8 million. Volume and value were respectively 15.3 and 12.8 percent lower compared with the corresponding months in 2023.

Updated December 2024 USDA data is shown in the table below:-

*Data influenced by HPAI losses. Recovery in 2025 considered unrealistic

Source: Livestock, Dairy and Poultry Outlook released December 16^th 2024

Subscribers to EGG-NEWS are referred to the postings depicting weekly prices, volumes and trends and the monthly review of prices, exports and related industry statistics.

OVERVIEW

The USDA provided updated projections for the production of corn and soybeans in the December 10^thWorld Agriculture Supply and Demand Estimates (WASDE) #655, reflecting the 2024 crop. Production values for corn and soybeans were predictably little changed from from the November edition and are based on actual harvest data. Projections of crop size and ending stocks are derived from acreage planted, updated yields from the harvest now completed, carry-forward levels from 2023, and with the latest assumptions relating to domestic use and exports.

The December 10^th WASDE report confirmed that corn was harvested from 82.7 million acres, unchanged from the November projection. The soybean crop was harvested from 86.3 million acres, unchanged from the November report.

The December WASDE held the yield value for the 2024 corn crop at 183.1 bushels per acre. By comparison yield was 174.9 bushels per acre in 2023. The December value for soybean yield was unchanged from the previous WASDE at 51.7 bushels per acre compared to 49.9 bushels per acre in 2023.

The December USDA projection for the ending stocks of corn was down 13.1 percent to 1,738 million bushels. The December USDA projection for the ending stock of soybeans was unchanged at 470 million bushels.

The December 2024 WASDE held the projection of corn price at 410 cents per bushel. The projected average season price for soybeans was reduced 60 cents to 1,020 cents per bushel. The price of soybean meal was lowered $30 to $300 per ton. Projected commodity prices suggest lower feed costs for livestock and poultry producers. Row crop farmers will experience declining margins or in some areas corn will be below break-even given relative production costs and per bushel prices. This situation has contributed to an impasse in the decisions of the respective House and Senate Agriculture Committees regarding allocation of funding for the combination of nutrition support and conservation over farm commodity price supports delaying the 2023 Farm Bill. It is probable that even higher support prices will be required if importing nations respond negatively to tariffs proposed by the incoming Administration.

Projections for world output included in the December 2024 WASDE report, reflect the most recent estimates for the production and export of commodities especially in the Southern Hemisphere with an emphasis on Argentine and Brazil. Economists also evaluated the likely impacts from a transition to a La Nina event especially on South America. Hostilities are ongoing in Ukraine following extensive destruction of agricultural infrastructure by the Russian Federation. Production and hence exports of wheat, corn and sunflower from Ukraine will be reduced compared to pre-war averages.

It is accepted that USDA projections for export are also based on the perceived intentions and needs of China. This Nation has sharply curtailed purchases of commodities and especially U.S. soybeans during the current market year despite fiscal stimulus with a projected recovery of the Nation’s economy influencing consumer demand for food and fuel.

Reports on volumes of commodities exported are included in weekly editions of EGG-NEWS, derived from USDA-FAS sales data. Weekly Crop Progress reports will be posted through late November

CORN

Based on harvest data for the 2024 corn crop, the December WASDE Report confirmed a record crop of 15,413 million bushels, and compared to 15,234 million bushels for the previous 2023 record harvest. The “Feed and Residual” category was held at 5,825 million bushels. The Food and Seed category was unchanged at 1,390 million bushels. The Ethanol and Byproducts Category was raised 0.9 percent to 5,500 million bushels consistent with estimated demand for E-10 and higher blends for driving needs. Projected corn exports were raised 6.5 percent to 2,475 million bushels, based on recent orders, and ongoing shipments to China and taking into account the anticipated lower availability of coarse grains from Eastern Europe and as the drought in producing nations in South America. For market year 2023-2024 exports of U.S. corn were 36.9 percent higher, compared to the previous market year. For the first eleven weeks of the 2024-2025 market year corn exports were 30.8 percent higher than for the corresponding week in the previous market year. The USDA considers world weather patterns in developing projections including the effect of the transition to a La Nina event during the present quarter. The anticipated ending stock of corn in the December WASDE report was down 10.3 percent from the November WASDE to 1,738 million bushels.

Export of Shell Eggs and Products, January-October 2024.

The volume of exports of shell eggs is conditioned by the domestic needs of importers, price against competitors and regulatory disease and logistic restraints. The effect of price is demonstrated by the 182 percent drop in volume of shell egg exports from 2021 (198 million dozen) to 2022 (70 million dozen). Due to depletion of flocks in 2023, export prices increased 113 percent from $1.02 per dozen to $2.16 per dozen reflecting domestic prices. Depressed exports persisted in 2023 with 90 million dozen shell eggs exported at an average price of $1.80 per dozen. Losses from HPAI that rose in the last quarter led to a rise in domestic price. This situation persisted through the first half of 2024 but with prospects for improved volume based on prices stabilizing moderately above seasonal levels through the 4^th quarter.

It is probable that lost markets other than in the USMCA and Caribbean could eventually be reclaimed but not over the intermediate term. Sporadic and short-term exports may be made to various nations based on supply disruption caused by HPAI or other factors.

USDA-FAS data collated by USAPEEC, reflecting export volume and values for shell eggs and egg products are shown in the table below comparing 2024 with 2023:-

U.S. EXPORTS OF SHELL EGG AND EGG PRODUCTS DURING JANUARY-OCTOBER 2024 COMPARED WITH 2023

SHELL EGGS

Shell egg exports from the U.S. during the first ten months of 2024 declined by 8.3 percent in volume but was up 15.6 percent in total value compared to the corresponding months in 2023. Unit value increased by 26.4 percent to $2.30 per dozen compared to the corresponding period in 2023.

Shell egg exports from the U.S. during October 2024 declined by 13.2 percent in volume to 7.2 million dozen but were higher by 65.1 percent in total value to $17.5 million compared to the corresponding month in 2023. Unit value increased by 87.5 percent to $2.40 per dozen compared to October 2023.

Canada was the leading importer of shell eggs during the first ten months of 2024, with 50.2 million dozen representing 72.6 percent of volume and 73.2 percent of the total value of U.S. shipments of shell eggs. Unit price over January-October 2024 was $2.32 per dozen compared to $2.14 per dozen for all consignments in January-October 2023. Imports by Canada are driven by consumer demand balanced against availability through the controlled supply situation. This structure inhibits flexibility, necessitating imports from the U.S. to supply shortfalls especially when losses occur due to HPAI or under conditions of high demand. This model assures the Nation’s approximately 1,000 independent producers a stable income but is supported by higher prices to consumers. During October 2024 Canada imported 5.5 million dozen up 37.5 percent over the corresponding month in 2023. Value was up 165 percent to $13.5 million. Unit value was 90.6 percent higher to $2.45 per dozen.

The Caribbean Region (Bahamas, Netherlands Antilles, Cayman Islands, and others) was a distant second in shell egg imports from the U.S. valued at $26.1 million during January-October 2024, with 11.4 million dozen representing 16.5 percent of volume and 16.4 percent of the total value of U.S. shipments of shell eggs. Unit price over January-October 2024 was 13.5 percent higher to $2.29 per dozen.

Mexico was a distant third-ranked importer of shell eggs over January-October 2024 based on a volume of 2.0 million dozen representing 2.9 percent of export volume and 2.3 percent of value. Unit value of $1.80 per dozen is compared to an average value of $2.30 per dozen for all exports. During October 4^th-ranked Mexico imported 0.2 million dozen shell eggs from the U.S. valued at $0.4 million principally as breaking stock.

EGG PRODUCTS

The total volume of exported egg products during the past ten months of 2024 decreased 15.3 percent to 21,193 metric tons compared to January-October 2023. Total value of $95.8 million was lower by 12.8 percent compared to January-October 2023. Unit value increased by 3.0 percent to $4,522 per ton compared to January-October 2023. During 2023 the U.S. exported 29,814 metric tons of egg products valued at $134.3 million with a unit price of $4,505 per metric ton. Fluctuation in unit price reflects the composition of exports and the relationship between World supply and demand. Ukraine is now restrained in production but India continues as a significant exporter.

Japan was the leading importer by volume of U.S. egg products during January-October 2024 receiving 6,196 metric tons from the U.S. valued at $28.2 million representing 29.2 percent of volume and 29.4 percent of value with a unit price of $4,551 per metric ton. Volume for January-October 2024 was down by 31.5 percent and value was lower by 36.2 percent compared to the corresponding months in 2023. During October 2024 Japan imported 633 metric tons, down 9.4 percent over the corresponding month in 2023. Value was down 21.1 percent to $3.0 million and unit value was 12.8 percent lower at $4,739 per metric ton. During 2023 Japan imported 10,352 metric tons of egg products from the U.S., valued at $49.9 million. With the conclusion of a bilateral trade agreement, the U.S. should no longer be at a competitive disadvantage with respect to the E.U.

Mexico was the 2^nd ranked importer from the U.S. during January-October 2024 based on a volume of 4,193 metric tons with a value of $16.7 million, representing 19.8 percent of volume and 17.4 percent of the total value of U.S. exports of egg products. Exports to Mexico were up by 12.3 percent in volume but 9.7 percent lower in value compared to January-October 2023. The unit value of $3,982 per metric ton can be compared with the average unit value for U.S. exports of all egg products at $4,521 per metric ton. During October 2^nd- ranked Mexico imported 340 metric tons valued at $1.9 million. Volume was 153.7 percent higher and value was 137.5 percent above October 2023 achieving a unit value of $5,588 per metric ton.

Canada was the 3^rd-ranked importer over January-October 2024 based on a volume of 3,169 metric tons with a value of $12.7 million. Canada represented 15.0 percent of volume and 13.2 percent of value with a unit price of $4,008 per metric ton. During October Canada was 4^th- ranked as an importer with 253 metric tons representing 15.9 percent of exports of egg products down 25.0 percent from September 2023. Value was $1.8 million or 22.6 percent of the monthly total, down 25.1 percent from October 2023 with unit revenue of $4,743 per metric ton. Volumes shipped reflect restoration of the institutional and food service sectors. The relative availability of domestic product in Canada is currently adequate but with prospects of increased need for imports due to HPAI outbreaks.

The E.U.-27 maintained 4^th-ranked position among importers of U.S. egg products over the past ten months of 2024 with 2,128 metric tons. Value was $16.8 million with a high unit price of $7,895 per metric ton reflecting product mix. During October the E.U. imported 320 metric tons of egg products valued at $2.1 million with a unit price of $6,402 per metric ton, up 124.7 percent in volume but down 8.7 percent in value.

South Korea was ranked 5^th among importers of egg products during January-October 2024 with a volume of 1,358 metric tons. Export value was $5.5 million with a unit value of $4,050 per metric ton. Comparing these values with the corresponding months in 2023, volume was 94.6 percent higher and value was up by 48.7 percent. Most flocks in South Korea have been restored to production after depopulation following 2022-3 outbreaks of HPAI. Import volume will be influenced by the trend in flock depletions. South Korea imported 44 metric tons during September 2024 but no product since. During 2023 South Korea imported 1,141 metric tons valued at $5.3 million. Depending on severity, the return of HPAI may result in a disparity between local availability and demand requiring imports in 2024 as in 2022.

COMMENTS

Exports to Canada and Mexico combined in 2022 amounted to $126.5 million in value equivalent to 47.5 percent of the total value of shell eggs and products shipped. During 2023 exports valued at $150.7 million represented 50.8 percent of shell egg and egg products amounting to $296.5 million. Canada represented 59.0 percent of the $162.2 million for shell eggs and 10.3 percent of egg products valued at $121.2 million, consigned during 2023, emphasizing dependence on this USMCA partner. Over the past ten months of 2024 the USMCA imported shell eggs and products valued at $149.4 million. This represented 58.6 percent of all U.S. egg and product exports valued at $254.8 million.

Aspirational volumes of exports in excess of five percent of domestic production are unrealistic. The E.U., Japan, South Korea and Taiwan will indent according to their needs for undifferentiated shell eggs and products based on landed price in a competitive world market. Purchase decisions for commodities are determined by FOB price, freight, duty and broker margins. Shell eggs and the various categories of egg products are essentially commodities and generally do not respond to promotion. The recent appointment of a manager responsible for promoting exports and trade-related missions (‘junkets’) are inconsistent with prudent use of check-off funds. This opinion is based on an understanding of the factors motivating imports comprising need and price. The reality is that U.S. exports are heavily concentrated among our two USMCA partners in addition to the Caribbean region based on proximity and price.

Exports will be dependent on the willingness of importers to accept the World Organization for Animal Health (WOAH) principle of regionalization (zoning) in the event of outbreaks of exotic Newcastle disease or isolation of either H5 or H7 avian influenza (AI), in commercial flocks, irrespective of pathogenicity. Most importing nations are now applying regionalization and permitting imports on a zonal, county or state-exclusion basis following H5 or H7 AI infection. Canada and the U.S. operate according to a 2018 bilateral agreement to maintain trade in the event of outbreaks of catastrophic exotic diseases including HPAI and END.

Generally pasteurized egg products should not be subject to any embargo imposed following reports of AI or Newcastle disease in a region.

REVIEW OF NOVEMBER 2024 EGG PRODUCTION COSTS AND STATISTICS.

Commencing in January 2024 the EIC justifiably separated the production costs and unit revenue values for eggs derived from caged and cage-free flocks. Accordingly, EGG-NEWS will continue to summarize data but will consolidate production and export statistics for the U.S. egg industry as a total and compare financial data for the two shell-egg categories.

NOVEMBER HIGHLIGHTS

• November 2024 USDA ex-farm blended USDA nest-run, benchmark price for conventional eggs from caged hens was 364 cents per dozen, up 108 cents per dozen or 42.2 percent from the October 2024 value of 256 cents per dozen. For comparison, average monthly USDA benchmark price over 2023 was 146.0 cents per dozen with a range of 323 cents per dozen in January down to a low of 57 cents in May. Stock levels and prices prior to the onset of flock depletions due to HPAI indicated a relative seasonal balance between supply and demand. Future nest-run and wholesale prices will be largely dependent on consumer demand for shell eggs and products and the rate of replacement of pullets and hens depleted due to HPAI. Other considerations include diversion to shell sales from the egg-breaking sector in an interconnected industry.
• Fluctuation in wholesale price is attributed in part to the amplification of upward and downward swings associated with the commercial benchmark price discovery system in use. Highly pathogenic avian influenza has emerged as a consideration with resumption of migration of waterfowl. Approximately 30 million hens and at least 2.0 million pullets have been depleted year to date.
• November 2024 USDA average nest-run production cost for conventional eggs from caged flocks over four regions (excluding SW and West), applying updated inputs was almost unchanged from October at 74.0 cents per dozen. Approximately 60 cents per dozen should be added to the USDA benchmark nest-run cost to cover processing, packing material and transport to establish a realistic price as delivered to warehouses.
• November 2024 USDA benchmark nest-run margin for conventional eggs attained a positive value of 290.0 cents per dozen compared to a revised positive margin of 181.4 cents per dozen in October 2024. Average nest-run monthly margin over 2023 was 64.2 cents per dozen compared to 155 cents per dozen in 2022. This differential was mainly due to higher prices following HPAI-depletion of flocks. It is emphasized that the U.S. benchmark price reflects nest-run conventional eggs.
• The October 2024 national flock in production (over 30,000 hens per farm) was stated by the USDA to be up 2.7 million hens (rounded) to 296.4 million compared to the revised September 2024 value of 293.7 million. Approximately 3.0 million hens returned to production from molt in October together with projected maturation of 21.5 million pullets, with this number offset by depletion of an unknown number of spent hens.
• October 2024 pullet chick hatch of 27.5 million was up 3.4 percent or 0.9 million chicks from September 2024.
• October 2024 exports of shell eggs and products combined were down 12.9 percent from September 2024 to 404,000 case equivalents representing the theoretical production of 5.4 million hens. Canada and the Caribbean nations represented 95 percent of shell egg exports of 223,000 dozen based on need and price.

TABLES SHOWING KEY PARAMETERS FOR NOVEMBERE 2024.

Summary tables for the latest USDA November 2024 flock statistics, costs and unit prices made available by the EIC on December 9^th 2024 are arranged, summarized, tabulated and compared with values from the previous November 8^th 2024 release reflecting October 2024 costs and production data as applicable. Monthly comparisons of production data and costs are based on revised USDA values.

VOLUMES OF PRODUCTION REFLECTING THE ENTIRE INDUSTRY

*USDA Revised

• Revised USDA/EIC Note 1. Texas excluded to maintain confidentiality

PROPORTION OF U.S. TOTAL HENS BY STATE, 2024¹

Based on a nominal denominator of 290 million hens in flocks over 30,000 covering 95 percent of the U.S complement.

USDA has amended inclusion of specific states in regions and eliminated Texas data to protect confidentiality of Company flock

Sizes

1. Values rounded to 0.1%

Rate of Lay, weighted hen-week (USDA) 81.8% November 2024. 81.3% October 2024

*Revised USDA

*Revised, using data from USDA Livestock, Dairy and Poultry Outlook November 15^th 2024 taking into account demand from the food service sector and presumably including the effect of HPAI depopulation.

EGG-NEWS summarizes and comments on data and trends in the monthly USDA Cage-Free Report. This data is correlated and interpreted in the Weekly Egg Price and Inventory Report posted on EGG-NEWS mailed on Fridays each week.

The USDA Cage-Free Report covering November 2024, released on December 2^nd 2024, documented the complement of hens producing under the Certified Organic Program to be 20.3 million (rounded to 0.1 million), down 0.6 million (2.4 percent) from October 2024. Depopulation was carried out in October and November as a result of HPAI. The number of hens classified as cage-free (but excluding Certified Organic) and comprising aviary, barn and other systems of housing apparently decreased by 1.0 million hens or 0.9 percent from October 2024 to 105.6 million, with extensive flock depopulation during the month. Hen numbers posted by the USDA for November are questioned as to accuracy taking into account chick placements and the magnitude of depopulation figures released by APHIS.

The number of eggs collected is accepted as accurate but since the values for average hen-week  production are unacceptably high this suggests that the denominator reflecting the number of hens is probably incorrect. Alternatively if conventional eggs from cages are deceptively marketed as cage-free, or if cage free eggs are packed as certified Organic, assuming an accurate number of hens over a given month, the apparent hen-week value would be disproportionally high. The respective numbers of hens claimed for organic and cage-free flocks should reflect the net contribution of chick placements 20-weeks previously, HPAI depopulation and age-related depletion and should correspond to monthly supply data and inventory extending over successive quarters. Unlike conventional cage production cage-free hens are not generally molted reducing this possible reason for error in calculating rates of production.

Average weekly production for Certified Organic eggs in November 2024 was down 3.1 percent compared to October 2024 with a questionably high average weekly production of 83.4 percent. Average weekly flock production for cage-free flocks other than Certified Organic was down 1.6 percent in November 2024, but with a high average hen-month production of 82.2 percent, down from 82.4 percent. Seasonally, younger flocks increase the availability of cage-free and organic eggs in response to pullet chick placements 20 weeks previously especially in anticipation of periods of peak seasonal demand. Since the proportion of pullets according to housing type is not indicated in the monthly USDA Chickens and Eggs report, it is not possible to validate the relative sizes of flocks producing under the certified organic label or other categories. There is no adequate explanation for the high production rate especially if the reported number of hens is lower than actual, and in view of  a possible undercount following HPAI flock depopulation.

Negotiated nest-run grade-ready cage-free price for November 2024 averaged $4.55 per dozen, up 10.4 percent from $4.12 per dozen in October 2024, reflecting presumably higher demand relative to supply. The November 2024 advertised U.S. featured retail price for cage-free eggs over five regions (excluding SW, AK. and HI.) was $2.90 per dozen, down 41 cents cents per dozen (-12.3 percent) from October 2024 based on 652 stores. This compares with 442 in October and compared to 4,484 stores in August confirming fewer promotions as the year progressed and with seasonal emergence of HPAI.    

The recorded average wholesale price of $4.55 per dozen plus a provision of 60 cents per dozen for packaging, packing and transport, results in a price of $5.15 per dozen delivered to CDs. The average five-region advertised retail price of $2.90 per dozen corresponds to a theoretical average retail negative margin of 48.7 percent (-28.3 percent last month unless prices were raised) over the average wholesale delivered price denoting “loss leaders” among stores featuring cage free eggs. Margins are presumed higher for non-featured eggs including pastured and other specialty eggs at shelf prices reaching $9.00 per dozen in high-end supermarket chains. Retailers maximizing margins especially on Certified Organic, free-range and pastured categories restrict the volume of sales, ultimately disadvantageous to producers.

Based on the importance of cage-free production, with more than 40 percent of eggs produced, accurate and consistent figures are required by the industry. The USDA-AMS issues the Cage-Free report on volumes and prices at monthly intervals for the information of stakeholders. There is obvious doubt as to the accuracy of individual monthly flock numbers in the monthly cage free reports especially with a marked change at the end of a quarter as with values for October 1^st, or from the previous month without obvious cause, or alternatively when there is no change in cage-free or organic flocks for sequential months.

It is suggested that USDA should consider a quarterly report with accurate hen data. This would be more useful to the industry for planning and marketing decisions. Price data is available each week from other USDA reports.

Subscribers are referred to weekly USDA wholesale and retail prices posted in the Egg Price and Inventory Report in EGG-NEWS E-mailed each Friday. The previous Monthly Cage-Free Report is available under the STATISTICS Tab.

Status of 2024 Corn and Soybean Crops

The USDA Crop Progress Report released on November 12^th recorded 96 percent of the soybean crop harvested, an advance of 2 percent this past week. Ninety five percent of the corn crop has has been harvested, up 4 percent from last week. Both crops were ahead of the 5-year averages by 5 percent and 11 percent respectively compared to the corresponding week in 2023. At the end of each season extending into mid-November progress in completing the harvest slows following the principle of diminishing returns as poor quality and late-planted fields remain.

Consistent with seasonal temperatures and previous rainfall across the Midwest and Plains states, crop condition was assumed to have remained unchanged during the past four weeks in the absence of reports. Prospects for high corn and soybean yields were reflected in stable price projections in the WASDE. The CME futures prices for November and December (‘new crop’) delivery were higher by less than five percent compared to the USDA projections.  

Heat stress that occurred during silking predisposes corn to fungal infection leading to mycotoxin contamination of kernels. Unseasonal rain during the immediate pre-harvest period for corn will also contribute to the elaboration of mycotoxins. The status of the 2024 crop in regions will require monitoring post-harvest in affected areas and especially if unseasonal precipitation occured during the late pre-harvest period. Initial assays suggest corn with elevated DON in some regions.

Reference is made to the November 8^th WASDE Report #654 retrievable under the Statistics TAB, and the weekly Commodity, Economy and Energy Report, in this edition, documenting acreage harvested, yields, weekly prices and ending stocks. Data for 2024 will be updated finally in the December WASDE to be summarized in the December 14^th edition of EGG-NEWS.

The November WASDE presumably incorporated the results of the USDA-NASS annual remote survey on yields and final production. Pro Farmer completed their annual crop tour in mid-August. The November WASDE report estimated U.S. corn yield at 183.1 bushels per acre (compared to the Pro Farmer estimate of 183.8 bushels per acre) with a projected crop of 15.14 billion bushels. (Pro Farmer, 15.20 billion bushels). The corresponding values for soybeans were a yield of 51.7 bushels per acre (Pro Farmer 53.1 bushels per acre) contributing to a 2024 crop of 4.46 billion bushels. (Pro Farmer 4.93 billion bushels).

The USDA quarterly Grain Stocks Report released on September 30^th 2024, documented storage of corn and soybeans, classified according to on-site and remote facilities including elevators and commercial installations. Quantities of the two major ingredients as Prices and commentary are incorporated in the Weekly Energy, Economy and determined by USD-NASS, relevant to the cost of poultry production were:-

“Old crop corn stocks on hand as of September 1^st 2024 totaled 1.76 billion bushels, up 29 percent from September 1^st 2023. Of the total corn stocks, 780 million bushels (44 percent were stored on farms), up 29 percent from last year”. This was down from 61 percent three months ago indicating a sell-off despite declining prices to realize income and make room for the 2024 harvest. “Off-farm stocks, at 980 million bushels, were up 30 percent from a year ago. The June-August 2024 indicated disappearance was 3.24 billion bushels, compared with 2.74 billion bushels during the same period a year earlier”.

“Old crop soybeans stored in all positions on September 1^st 2024 totaled 342 million bushels, up 29 percent from September 1^st 2023. Soybean stocks stored on farms totaled 111 million bushels,  (32 percent) up 54 percent from a year ago. Off-farm stocks, at 231 million bushels, were up 20 percent from last September. Indicated disappearance for June-August 2024 totaled 628 million bushels, up 18 percent from the same period a year earlier”.

The weekly Economy, Commodity and Energy Report posted each week and a summary of the WASDE #652 released on September 12^th is retrievable under the STATISTICS tab.

THE USDA Agricultural Prices Report released October 31^st posted September prices for agricultural commodities and expenditures.

September Prices Received Index, down 2.9 percent from August

 The USDA ERS summarized prices as follows:-“The September Prices Received Index 2011 Base (Agricultural Production), at 122.6, decreased 2.9 percent from August and 7.1 percent from September 2022. At 113.9, the Crop Production Index was down 4.2 percent from last month and 11 percent from the previous year. The Livestock Production Index, at 133.1, decreased 0.9 percent from August, and 2.6 percent from September last year. Producers received lower prices for corn, hogs, soybeans, and lettuce during September, but higher prices for broilers, milk, grapes, and broccoli. In addition to prices, the volume change of commodities marketed also influences the indexes. In September, there was decreased marketing of cattle, wheat, cotton, and peaches and increased monthly movement for soybeans, corn, dry beans, and apples”.

September Prices Paid Index, Up 0.1 Percent from August

“The September Prices Paid Index for Commodities and Services, Interest, Taxes, and Farm Wage Rates (PPITW), at 138.8, is up 0.1 percent from August 2023 but unchanged from September 2022. Higher prices in September for feeder cattle, feeder pigs, diesel, and nitrogen more than offset lower prices for feed grains, complete feeds, concentrates, and hay & forages”.

Corn farmers received $5.21 per bushel in September 2023 compared to $5.73 per bushel in August 2023, down 9.1 percent. The price received in September 2022 was $7.09 per bushel

Soybean farmers received $13.20 per bushel in September 2023 compared to $14.10 per bushel in August 2023, down 6.8 percent. The price received in September 2022 was $14.20 per bushel

The September 2023 egg price received by farmers was $ 1.22 per dozen for table eggs lower than $1.35 per dozen in August 2023 and compared to $2.65 per dozen in September 2022. The sharp year-on-year increase is attributed to disequilibrium between supply and demand. Highly pathogenic avian influenza resulted in depletion of 44 million hens with a reduction of 20 million producing birds in the supply flock on average from mid 2022 onwards. This situation was coupled with increased demand as consumers increased purchases of eggs representing a competitively priced protein source in an inflationary environment.

The June 30^th 2023 Planted Acreage report documented the respective areas planted to corn and soybeans, the two commodities of relevance to the poultry industry. The USDA confirmed:-

Corn-planted area for all purposes in 2023 is estimated at 94.1 million acres, up six percent or 5.52 million acres from last year. This represents the third highest planted acreage in the United States since 1944. Compared with last year, planted acreage is expected to be up or unchanged in 43 of the 48 estimating States. Area harvested for grain, at 86.3 million acres, is up nine percent from last year.

Soybean-planted area for 2023 is estimated at 83.5 million acres, down five percent from last year. Compared with last year, planted acreage is down or unchanged in 21 of the 29 estimating States.

Together with the Grain Stocks report the Planted Acreage data moved the market for corn and soybeans by about five percent but in contrasting directions.

For corn the acreage was above the most optimistic projection although offset by a lower stock. At 14H30 on the CME after the release of the two USDA reports, corn was down 25 cents per bushel to 556 cents for July delivery and for September, corn was down 34 cents per bushel to 489 cents.

For soybeans the reduced acreage and consequently lower ending stocks was bullish for the new crop. At 14H30 CME soybeans were up 75 cents per bushel to 1,558 cents for July delivery and for September the soybean price was up 73 cents per bushel to 1,354 cents.

According to USDA economists, retail egg prices increased by 8.5 percent in January 2023, approximately 70.1 percent above January 2022.  The USDA-ERS now predicts that egg prices will increase by 37.8 percent in 2023 but with a wide range of 18.3 to 62.3 percent attributed to volatility.  Concurrently the USDA-ERS predicted a 4.7 percent increase in the price of meats, 7.2 percent for dairy products and 12.8 percent for cereals and bakery products.

Wholesale farm-level egg prices are predicted to increase by 7.4 percent in 2023 with a wide prediction interval of -32.6 to 76.1 percent.  Egg prices are extremely volatile, complicating reliable predictions.

EGG-NEWS will monitor weekly USDA wholesale prices by region and average retail prices to document retail margins.