Organic Soybean Prices Remain Robust as Trend in Organic Chicken Retail Sales Rise

Organic soybean prices continue to climb despite a temporary drop in organic chicken slaughter. The lack of home ground domestic US soybeans has the US relying on India. Imports have slowed in May according to The Jacobsen, leaving several consumers short.

Organic Corn Prices Remain Soft

Spot organic corn prices remain soft as organic chicken feed demand has temporarily eased. Producers are putting their feed-demand temporarily on hold as slaughterhouses recover from closures due to COVID-19. Slaughterhouses are in the process of disinfecting plants and revamping operations to provide a safer working environment. Organic chicken slaughter tumbled in early April, dropping nearly 30% but has rebounded about 50% of the losses over the past 5-weeks.

Organic Chicken Sales Index Trends Higher

What is surprising is that retail demand has remained steady, as supermarkets continue to run through inventories. Some of the major chicken producers see meat production taking a while to rebound. Plants in Pennsylvania, Colorado, Minnesota, and Wisconsin are operating at 70-90% of capacity, according to reports.

The dip in supply of organic chickens has come just as home stockpiles are dwindling. This should put upward pressure on organic chicken prices. The trend in organic retail sales is expected to climb by 2% year over year for the season-ending September 2020, according to The Jacobsen.

The trend in monthly organic chicken sales is upward sloping rising from left to right which points to continued rising organic chicken sales. The rise in organic chicken prices are unlikely to dent consumption, and slaughter should rebound before demand destruction occurs. Solid demand and tailwinds created by US stimulus are likely to keep upward pressure on organic commodities prices, according to a price forecast from The Jacobsen.