The amount of turkey in U.S. freezers grew more than anticipated last month despite an outbreak of bird flu that killed more than nine million turkeys, experts said following Friday's government monthly cold storage report.
The U.S. Department of Agriculture storage report also showed record-high pork and ham inventories for a second month in a row due to efforts at controlling Porcine Epidemic Diarrhea virus (PEDv) which has wiped out an estimated eight million pigs since May 2013.
July frozen whole turkeys stocks, including toms and hens, totaled 297.2 million pounds. That was up 23.7 million pounds from June and an 8.7 million pounds bump from July 2014.
"Everybody is talking about a turkey shortage, but the turkey stocks total actually rose," said Doane Advisory Services economist Dan Vaught. The industry likely stored more whole birds for its "bread and butter" year-end holiday season, he said.
Bob Brown, an independent market analyst in Edmond, Oklahoma, attributed part of the increase to a backlog of product after several countries banned U.S. poultry exports over bird flu worries.
Total pork inventories in July were 635.2 million pounds, a record for the month, surpassing the prior July record of 549.6 million in 2012. It comes on the heels of June's 634.5 million lb record.
Hams, which accounted for most of that increase, also marked an all-time July high of 206.7 million pounds, eclipsing its previous 180.7 million pounds monthly record set in 2013. Total ham stocks also notched a June record of 180.5 million pounds.
"The pork sector has attempted to build ham stocks due to the turkey industry's problems in the wake of the bird flu outbreak in Minnesota," said Vaught.
Additionally, more pork is typically funneled into cold storage warehouses this time of year for use during the Thanksgiving and Christmas holiday period, he said.
While hams represented the largest July increase in the pork category, pork bellies showed the biggest drawdown. At 23.6 million pounds, pork bellies fell nearly 21 million pounds from June and 41 million pounds from a year earlier.
The July 2015 comparison was made to huge inventories last year when processors and other end-users rushed pork bellies into warehouse for fear of PEDv-shortened supplies, which did not materialize, said analysts.
Increased retail and food service bacon use comes at much cheaper prices than last year, resulting in a significant "pull through" in belly holdings, said Brown. (Reporting by Theopolis Waters; Editing by James Dalgleish)