By Marsha Laux, content specialist, AgMRC, Iowa State University, firstname.lastname@example.org.
Revised November 2013 by Diane Huntrods, AgMRC, Iowa State University.
The United States is the world’s largest turkey producer and largest exporter of turkey products. While exports are a major part of the U.S. turkey market, domestic consumption is higher than any other country, at 16.4 pounds per person in 2012 (ERS).
According to the USDA, turkey production in 2012 was more than 7.5 billion pounds, up 4 percent from the 7.3 billion pounds produced in 2011. The total value of the turkeys produced during 2012 was more than $5.4 billion, up 10 percent from the nearly $5.0 billion during the previous year. (NASS 2013)
Raising turkeys in the early twentieth century was largely a seasonal endeavor. In the mid-1920s, development of poultry feeds allowed for large-scale, year-round production in protective environments. The 1950s and 1960s saw vertical integration commonplace in the poultry industry. The 1980s and 1990s saw improved production practices involving nutrition, disease eradication, genetics and meat processing.
Turkey production is scattered around the United States. The top five turkey-producing states in 2012 were (by number raised): Minnesota, North Carolina, Arkansas, Missouri and Virginia. Minnesota produced more than 1.16 billion pounds of turkey valued at $839.1 million, and North Carolina produced nearly 1.18 billion pounds of turkey valued at nearly $848.8 million. (NASS 2013)
As of 2012, the United States continued to lead the world in turkey production with nearly 2.7 million metric tons (MT), followed by the European Union-27 with more than 2.0 million MT (FAS 2013).
According to the USDA, consumers are increasingly choosing poultry as their meat products. Over the last 10 years, the percentage of poultry meat consumption has grown more rapidly than red meats. In particular, consumption of turkey in the United States has gradually increased from 0.8 pounds per year in 1910 to16.4 pounds per year in 2012.
The National Turkey Federation says the U.S. turkey industry has experienced unprecedented growth during the past 20 years. The federation states, “Today’s consumer recognizes turkey’s nutritional value and enjoys turkey year-round, not just during the holidays." The turkey industry has developed from a single-product, holiday-oriented market to a year-round, diversified and value-added product line. Increasingly, turkey products are marketed in a variety of ways. In the deli markets, turkey has developed as a favorite for health-conscious consumers.
Distribution for turkey products in 2011 was as follows: 47.4 percent sold to grocery stores and other retail outlets; 30.0 percent sold in commodity outlets; 15.5 percent sold to foodservice outlets; and 6.2 percent exported (National Turkey Federation).
The average price received by producers was 50 cents per pound in 2009, compared to 56.5 cents per pound in 2008. The whole turkey continues to be the most popular turkey product, and in 2009, the average retail price for whole frozen turkeys in the United States was $1.39 per pound (National Turkey Federation).
Drivers of Demand
Turkey consumption has been increasing for the last decade. During that time, the largest growth of turkey product sales has been ground turkey. This is due to increased use of ground turkey as a lower fat substitute for ground beef. In addition to health concerns, taste and convenience are also factors that are driving the changes in consumption patterns of protein foods.
The poultry industry has responded to the consumer demand for taste and convenience by pre-cooking poultry items and selling into the convenience market. Examples of convenience marketing are turkey strips that are pre-seasoned and pre-cooked, and ready to eat in sandwiches. Additionally, pre-cooked turkey products such as deli breast, turkey bacon and turkey ham have all experienced substantial segment growth.
Food safety and environmental concerns are also factors in the increased consumption of poultry products, because consumers perceive these products to be more wholesome. Turkey companies are marketing more natural and “air-chilled” products in response to these concerns.
The United States is the largest exporter of turkey products. The United States exported nearly 361,884 metric tons (MT) of turkey meat in 2012, up 14 percent from the previous year. The turkey products were valued at nearly $678.9 million, a 13 percent increase from 2012.
Mexico continued to be the dominant market for U.S. turkey meat, purchasing meat valued at nearly $372.6 million and accounting for 55 percent of turkey exports. Likewise, China continued to be the second largest market for U.S. turkey, purchasing more than $70.5 million of meat. Canada and Hong Kong were other significant markets for U.S. turkey meat. (FAS 2012)
The majority of turkey products ship as lower valued turkey parts or ground or mechanically deboned meat. Many importers use the turkey products with other meats in sausage production.
The United States imports a small amount of turkey meat ($31.8 million in 2012), mostly from Chile and Canada. (FAS 2012)
Vertically integrated companies dominate the turkey industry. Those companies control the turkey from production through processing. The industry is concentrated. The National Turkey Federation estimates that the 2012 leaders in the turkey industry are as follows:
|Top Five U.S. Processors||Processed Live Weight, in million pounds|
|Jennie-O Turkey Store, Inc.||1,275|
|Cargill Value Added Meats||1,095|
|Farbest Foods, Inc||385|
|Hillshire Brands Company||358|
Industry Life Cycle
Turkey producers have benefited from economies of scale associated with the industry’s horizontal and vertical integration. However, projected gains in efficiency over the next decade are smaller than in the past 25 years.
The U.S. consumer will continue to buy more meat but will use a smaller proportion of their disposable incomes for meat purchases. Poultry purchases will continue to rise as a share of consumer spending on meats, while beef and pork expenditures are expected to decline.
United States production of turkey is forecast up 3 percent in 2014 to a record 2.7 million tons on lower feed prices. Exports are forecast to rise 5 percent to 354,000 tons on expanding shipments to East Asia although Mexico remains the major market. (FAS 2013)
Food Availability (Per Capita) Data System, Economic Research Service (ERS), USDA.
Global Agricultural Trade System, Foreign Ag Service (FAS), USDA.
Poultry, Meat and Eggs, FAS, USDA.
Prepared September 2004 and revised November 2013. Links checked December 2013.