www.WATTpoultry.com JUNE 2008 volume 113 number 6
Second half of 2008 still looks profitable
Industry News
Put the Consumer First
Find Out What the Customer Wants
Nine Green Technologies for Animal Agriculture
Uproar over Ethanol
Calendar
Marketplace
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5
6
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10
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Second half of 2008 still looks profitable
But questions loom for 2009.
By Edward Clark, Editor
Virtually everyone in the egg business looked for 2008 to be a good
one, and it still will end up being
so, although adding up the year, profits
won’t be quite as rosy as they looked
just months ago. The reason why: sky-high feed costs. Even so, egg production will end up being profitable in every month the second half of the year, or
nearly so.
The Urner Barry Midwest price quote
for May looked likely to average $1.10,
near break even, “and prices will likely
move up 10 cents to 20 cents from there
to November-December,” says Bob
Pike, vice president and general manager for Braswell Foods, Nashville,
N.C.
But Pike is concerned about 2009,
as “a 100,000 birds here, a refurbishing there” could add up to an unprofitable industry by the third quarter of
next year, possibly earlier. He adds that
even the switch to more specialty egg
and cage-free egg production will add
to total egg production.
Consumption Holding
One surprise in 2008, Pike says, is
that specialty egg consumption is so
high in light of the weak economy.
“Eggs are still a very affordable protein
source compared to chicken, pork, or
beef,” he says, “and eggs are a comfort
food.” As for his company, “we’re flat”
in terms of increasing production, Pike
says. “We’re settling out.”
UB MW LARGE MARKET QUOTE EGG PRICE PROJECTIONS ( 12 mont hs)
149.7 149.7
150
137.3
137.3
132.7
128.8
125.7
124.2
126.5
126.5
130.3
120
119.5
This chart shows that egg prices
in cents/dozen are expected to be
near 150 by November.
90
Apr May June July Aug Sept Oct Nov Dec Jan Feb Mar
Prices near 2007 Levels
Prices for the second half of 2008
will be close to last year’s, in the view
of Dolph Baker, resident of Cal-Maine
Foods, Jackson, Miss. “We’ll have
good profits, but not the record profits
like last year,” he says, due to skyrocketing grain costs. Baker notes that not
much expansion is underway, thus the
flock size “is not getting out of control.”
He adds that even May was profitable,
