Turkey Shortage Looks Likely in 2022, Bird Flu Takes a Toll on Production

Mohit Oberoi, CFA - Author
By

Jul. 20 2022, Published 8:41 a.m. ET

Intermittent food shortages have become quite common over the last two years. Seasonal shortages have been even more severe and there was a shortage of some turkey sizes before Thanksgiving Day in 2021. Now, there are fears of another turkey shortage in 2022. Will there be a turkey shortage in 2022 as well?

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Baby formula has been the most severe food shortage in 2022. The situation is easing now after Abbott’s plant reopened and the U.S. imported formula from other countries. Peanut butter and sriracha sauce have also been in short supply.

The U.S. turkey production is expected to fall in 2022.

The U.S. Department of Agriculture expects the country’s turkey production to fall to 5,359 million pounds in 2022. If the estimates are correct, U.S. turkey production will fall for the third consecutive year.

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The country produced 5,818 million pounds of turkey in 2019, which fell to 5,743 million pounds in 2020 and 5,558 pounds in 2020. The Department forecasts that U.S. turkey production will rise to 5,650 million pounds in 2023.

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During the holiday season in 2021, some people weren't able to find certain turkey sizes. The smaller sizes were particularly hard to find. The 2021 holiday season was marred by shortages and global supply chain woes.

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Why is U.S. turkey production projected to fall in 2022?

U.S. turkey production is expected to fall in 2022 after avian influenza outbreaks in the Midwest, which is the highest turkey-producing region in the U.S. The flu has also affected the production of eggs and chicken. Millions of birds in the country have been affected by the disease, which was mostly spread by migrating birds.

Hormel Foods, which owns the Jennie-O branded turkey products, has warned of “large supply gaps” in the back half of the year and has predicted that volumes would fall 30 percent over the period. The company also lowered its full-year earnings forecast.

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Turkey production is expected to fall in some other countries too. In the U.K., the bird population has also been hit by the avian flu. To make things worse, the cost of raising poultry has spiked amid the steep rise in grain prices. This has made turkey farming unviable for many.

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U.S. turkey prices have also been rising.

U.S. turkey prices have also been rising. In June, while the CPI rose by 9.1 percent, poultry prices increased by 17.3 percent. The Department of Agriculture has also upwardly revised its turkey price forecast for the back half of 2022 as well as 2023.

There already appears to be a turkey shortage in 2022.

There could be a turkey shortage again in 2022 amid the expected fall in production. Some regions are already battling a turkey shortage. Jimmy John’s had to take some turkey sandwiches off its menu. The situation might get worse as the turkey demand spikes in the fourth quarter of the year.

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