Turkey prices are surging ahead of Thanksgiving due to disease
Americans are paying more than ever for turkey as a contagious virus leads to the destruction of millions of birds.
The Highly Pathogenic Avian Influenza (HPAI) virus is helping drive the price of turkey — specifically white boneless breast meat — to record highs, even as the hottest inflation in 40 years has cooled some in recent months. That may make the Thanksgiving meal even pricier this year.
"We've seen record prices for turkeys in recent days, and the spotlight is on Highly Pathogenic Avian Influenza and its effect on the market," American Farm Bureau economist Bernt Nelson told CBS MoneyWatch.
Seven years after the last U.S. outbreak, HPAI has been hitting U.S. commercial poultry flocks all year, with the latest wave particularly disruptive to turkey suppliers.
This year, HPAI has been confirmed in 430 commercial and backyard poultry flocks across 39 states. The virus has wiped out nearly 44 million turkeys, chickens, ducks and other birds, according to the U.S. Department of Agriculture's Animal and Plant Health Inspection Service.
Minnesota outbreaks
The latest outbreak was confirmed Wednesday at a commercial turkey meat facility in Minnesota's Morrison County, with 50,000 birds lost.
Minnesota — the nation's biggest turkey producer — in late August detected its first outbreak of bird flu in three months at a turkey operation in Meeker County, resulting in the culling of 129,000 birds. Another outbreak was confirmed in the county the next day, claiming another 46,000 turkeys.
HPAI has so far reduced U.S. turkey production by about 3% versus year-ago levels, according to Nelson. "If we keep seeing these outbreaks, that's going to be a driver of prices," he said.
Egg prices have nearly tripled and turkey breast meat has jumped 60% to record levels this year, according to recently released analysis from CoBank.
"Coinciding with widespread outbreaks in U.S. turkey flocks during 2022, wholesale spot market values for fresh tom breast meat has eclipsed $6.50 per pound in recent weeks, a level previously deemed unattainable," writes CoBank economist Brian Earnest.
What it costs
In another nod to HPAI's impact, Hormel Foods' CEO listed the company's "limited turkey supply" as among the challenges facing the company as it last week lowered its yearly profit forecast.
Americans paid an average of $23.99 for a 16-pound bird last Thanksgiving, with the cost up about $1.50 a pound, or 24% higher than in 2020, the AFB estimated last November. While the bureau isn't out with its annual price forecast for 2022 yet, recent turkey prices signal the upcoming holiday could be a costly one.
A fresh 16-pound tom turkey now runs about $29.92, while a frozen version is going for about $26.24, and that is before the bird hits retail, as the figures are based on trading prices from the USDA. Consumers typically pay higher prices because grocers add on the costs of packaging, shipping and labor costs.
An eight-to-16-pound fresh whole young tom turkey averaged nearly $1.80 a pound in August and this week averaged $1.87 a pound, according to the agency. Frozen tom turkeys recently traded at $1.64 a pound, up two cents from $1.62 in August.
The good news? There should still be ample supplies of the meat for Thanksgiving, with the frozen birds most Americans buy for the annual holiday meal already in warehouses, according to the National Turkey Federation's Beth Breeding.
"We are still expecting the traditional holiday deals that you might see at the grocery stores," she told CBS MoneyWatch.