Low Consumer Demand and Reduced Prices Impact US Turkey Industry

The American turkey industry had little to celebrate on Thanksgiving Day 2024.

For years, the farmers who grow the birds and the integrated processors who feed, transport, and process them have faced adverse market conditions, shrinking demand for their products, and consistent animal health challenges.

In 2024, according to estimates published by the U.S. Department of Agriculture’s National Agricultural Statistics Service (NASS) in September, the size of the national turkey flock likely dropped to a level not seen since the 1980s. Nevertheless, Mark Jordan, executive director of animal agriculture consultant Leap Market Analytics, told The Epoch Times that the price of turkey isn’t rising as it should in a short supply scenario because demand is so low.

According to statistics published by the USDA’s Economic Research Service on Nov. 8, the 2024 price for frozen whole turkeys average about 94 cents a pound. That’s the lowest mark since 2019, when the average was 89 cents a pound. In 2023, the average price was $1.40 a pound.

Bernt Nelson, an economist at the American Farm Bureau Federation (AFBF), told The Epoch Times that wholesale turkey prices are down by 28 percent. At the same time, the rising cost of doing business continues to strain farmers’ resources.

“It’s a hard year to be a turkey farmer,” Nelson said.

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Overall, the total number of turkeys raised in the United States has declined every year since 2017, when more than 244 million birds were raised.

Jordan said the USDA estimates are consistent with figures he reviewed, which said less than 200 million birds will be slaughtered by the end of the year. That is the first time the industry has processed less than 200 million birds since 1986.

Jordan said there are three main reasons for the decline in production.

First, the industry is processing bigger, heavier birds than it has in the past, which leads to a lower total head slaughtered figure. Brian Earnest, the lead economist focused on animal protein at CoBank, told The Epoch Times that turkey processors always want a bigger bird for deboning. Turkey breast, which is used for deli meats and other processed turkey products, is the most valuable part of the animal.

Second, Jordan said the turkey industry is coping with more than 15 years of protracted decline in demand for its products. In 2024, Americans will eat about 13.8 pounds of turkey meat per capita. That is the lowest total, he said, since 1986, when Americans consumed about 12.6 pounds per capita.

Earnest said U.S. consumers are shifting away from eating turkey on Thanksgiving and other holiday gatherings. Instead, they are putting ham, beef, and other proteins at the center of the table.

Earnest said even retailers that sell whole turkeys at a loss as part of their annual promotions were dialing back their so-called specialing ahead of Thanksgiving 2024. Jordan said rather than taking as many birds as they can get, grocers are now generally opting to buy just as many birds as they expect to be able to sell.

This has been tough on the industry since Thanksgiving, and, to a much lesser extent, Christmas, accounts for almost all of the bird demand. According to figures published by the AFBF on Nov. 25, Turkey Day alone accounts for 22 percent of the annual demand for turkey meat.

Additionally, there is little demand for turkey outside of the United States. As a North American animal, the rest of the world eats a negligible amount of turkey. Jordan said Mexico is the only country that imports a significant amount of turkey meat from the United States.

Finally, the turkey industry is dealing with consistent animal disease challenges. Specifically, Jordan said, turkey growers and processors are challenged by repeated outbreaks of highly pathogenic avian influenza (HPAI) and avian metapneumovirus.

Jordan said the disease challenge in the turkey industry is “as bad as any major animal agriculture industry right now.”

HPAI is a highly contagious disease spread by wild bird populations to domesticated birds. When infected, entire barns of poultry need to be culled to control disease spread. The North American poultry industry has dealt with sporadic HPAI outbreaks since 2014.

Jordan said that in 2024, the disease has led to the loss of about 1.7 million turkeys. However, HPAI has sometimes claimed as many as 8 million turkeys in a single year.

Metapneumovirus is more problematic for so-called breeder birds that lay eggs to be raised on farms for slaughter. It causes a lack of fertility and hatchability, which likely had a 5 percent negative impact on the size of the turkey flock, Jordan said.

While turkey production was historically low in 2024, prices did not rise as they have in past years. Nelson said demand is just so poor that a reduced supply is not leading to a price increase.

“We’ve just seen things drop off,” Nelson said.

American turkey consumption is projected to drop again in 2025. To further complicate matters, there is still a considerable amount of frozen turkey in cold storage to supply the U.S. market if consumer demand outstrips 2024 production.

The modern U.S. turkey industry operates in an integrated model. Major animal protein companies, such as Tyson Foods Inc., own the birds and provide the feed. They contract with farmers, known as growers, who pay the cost of building, outfitting, and maintaining the barns where the animals are raised. After birds meet a target weight, the integrator collects, processes, and markets them.

The industry observers who spoke with The Epoch Times said that while times have not been good for turkey processors, they are staying in business for the most part. The bigger strain is placed on the growers.

Generally, Nelson said, farmers have dealt with two consecutive years of rising input costs and declining income from their products. Turkey farmers are facing a tricky scenario because this pattern is eating into any money they may have set aside to keep their farms running and to make necessary capital improvements to their poultry facilities. To stay in business, turkey farmers, in particular, have to increasingly rely on credit.

“It puts you into a more dangerous position in the credit cycle,” Nelson said. “We’ve had several years eating into working capital, and there’s a lot of guys that are starting to run out of resources.”