Record Turkey Prices Are Coming for Thanksgiving

The bird-flu outbreak has affected 39 states this year and has led to the death of more than 40 million birds, including roughly 6 million turkeys, according to the Agriculture Department—the second-deadliest outbreak on record. Newly confirmed cases in California and Minnesota have farmers and processors fearing a resurgence of the virus in the months ahead, analysts and executives said.

Breast-meat prices for consumers have climbed above $6.50 a pound this year, compared with less than $2 a pound two years ago, according to market -research firm Urner Barry. Turkey hens—which represent the majority of birds served on Thanksgiving—currently cost 57% more than the five-year average, the firm estimated. Both prices represent all-time highs.

Some of the biggest U.S. turkey suppliers said the virus has already cut into their supplies, pushing up prices.

Hormel Foods Corp.

, the second-largest turkey processor by volume behind Butterball LLC, said on Thursday that sales volumes for its Jennie-O Turkey Store brand fell 20% year over year for the three months that ended July 31. For the current quarter, the company expects sales volumes to be 30% lower.

Jacinth Smiley, Hormel’s chief financial officer, said, “Lower industrywide turkey supplies are expected to keep prices higher.”

Hormel executives said on Thursday that recent cases have affected its turkey supply chain, and that the company expects reduced production volume through at least the end of the first quarter of fiscal year 2023.

The combination of higher turkey-meat prices and limited supply helped boost Minnesota-based Hormel’s quarterly profits from its turkey business, which increased by about $30 million from 2021 levels.

Turkey supplies were tight before the bird-flu outbreak, following years of cutbacks by farmers responding to stagnant consumer demand and overproduction, said Russ Whitman, senior vice president at Urner Barry. Despite escalating prices, higher animal-feed costs are keeping turkey farmers from expanding their flocks, he said.

The National Turkey Federation, a trade group for the industry, still expects there will be enough turkeys to go around for the coming holiday season. Supply-chain problems have contributed to sporadic shortages of turkey products in the short term, said Beth Breeding, a spokeswoman for the group.

The tight turkey supply means some supermarkets might not get the exact quantity of 10-pound or 16-pound birds they ordered from their supplier for the holiday season, Urner Barry’s Mr. Whitman said, and it is likely to be more expensive. “Retailers are not getting what they want, they are getting what is available,” he said.

Turkey production for the third quarter of this year is estimated to be down nearly 7%, or about 20 million pounds, compared with the same period a year ago, according to the USDA.

Some farmers are trying to reduce the risk of bird-flu outbreaks by sending their turkeys to market earlier, and at lower weights than usual, according to analysts at agriculture lender

CoBank.

That has contributed to lower overall production, they said. Excessive heat this summer, which makes it harder for turkeys and chickens to gain weight, also tightened the turkey-meat supply, industry officials said.

Cargill Inc., the third-largest turkey processor, hasn’t been hit by the bird-flu outbreak as badly as others, said Tom Windish, president of Cargill’s primary business division, which oversees turkey. The company this summer started getting more orders from retailers looking for suppliers with turkeys, he said.

To help keep prices lower for consumers, Cargill is shipping more packages to retailers with less turkey in each one, Mr. Windish said. Cost-conscious customers may also opt for smaller turkeys this Thanksgiving to keep their spending down, he said.

A 2015 avian-influenza outbreak, the deadliest on record—it led to the death of about 50 million birds—ended in the middle of that year, and turkey-industry officials have said they hoped the same would hold this year.

Ms. Breeding, of the National Turkey Federation, said that in 2015 there were brief interruptions in the availability of some turkey items, but these were resolved before the holiday season.

After months of declining cases among commercial poultry flocks, the USDA confirmed several outbreaks this past week in California, leading to the death of nearly 400,000 turkeys. The Minnesota Board of Animal Health also confirmed that a commercial turkey flock was culled this past week in response to a bird-flu case. The timing of the detection was sooner than anticipated, said Shauna Voss, senior state veterinarian in Minnesota.

Entire poultry flocks are destroyed after an infection is confirmed to help limit the spread.

Warm weather has slowed the spread of the virus in the past, but the recent cases in California suggest that this strain may be more resistant to heat, analysts said.

Following the 2015 outbreak, the USDA upgraded its virus testing and detection systems, training and equipment, officials have said. Some farmers invested in new biosecurity systems for their barns meant to disinfect anyone who walks into the tightly sealed poultry houses so as not to track in wild-bird fecal matter. Despite the changes, farmers and USDA officials have struggled to halt this year’s outbreak.

“All we can do is concentrate on our operations,” said Cargill’s Mr. Windish.

Write to Patrick Thomas at [email protected]

The bird-flu outbreak has affected 39 states this year and has led to the death of more than 40 million birds, including roughly 6 million turkeys, according to the Agriculture Department—the second-deadliest outbreak on record. Newly confirmed cases in California and Minnesota have farmers and processors fearing a resurgence of the virus in the months ahead, analysts and executives said.

Breast-meat prices for consumers have climbed above $6.50 a pound this year, compared with less than $2 a pound two years ago, according to market -research firm Urner Barry. Turkey hens—which represent the majority of birds served on Thanksgiving—currently cost 57% more than the five-year average, the firm estimated. Both prices represent all-time highs.

Some of the biggest U.S. turkey suppliers said the virus has already cut into their supplies, pushing up prices.

Hormel Foods Corp.

, the second-largest turkey processor by volume behind Butterball LLC, said on Thursday that sales volumes for its Jennie-O Turkey Store brand fell 20% year over year for the three months that ended July 31. For the current quarter, the company expects sales volumes to be 30% lower.

Jacinth Smiley, Hormel’s chief financial officer, said, “Lower industrywide turkey supplies are expected to keep prices higher.”

Hormel executives said on Thursday that recent cases have affected its turkey supply chain, and that the company expects reduced production volume through at least the end of the first quarter of fiscal year 2023.

The combination of higher turkey-meat prices and limited supply helped boost Minnesota-based Hormel’s quarterly profits from its turkey business, which increased by about $30 million from 2021 levels.

Turkey supplies were tight before the bird-flu outbreak, following years of cutbacks by farmers responding to stagnant consumer demand and overproduction, said Russ Whitman, senior vice president at Urner Barry. Despite escalating prices, higher animal-feed costs are keeping turkey farmers from expanding their flocks, he said.

The National Turkey Federation, a trade group for the industry, still expects there will be enough turkeys to go around for the coming holiday season. Supply-chain problems have contributed to sporadic shortages of turkey products in the short term, said Beth Breeding, a spokeswoman for the group.

The tight turkey supply means some supermarkets might not get the exact quantity of 10-pound or 16-pound birds they ordered from their supplier for the holiday season, Urner Barry’s Mr. Whitman said, and it is likely to be more expensive. “Retailers are not getting what they want, they are getting what is available,” he said.

Turkey production for the third quarter of this year is estimated to be down nearly 7%, or about 20 million pounds, compared with the same period a year ago, according to the USDA.

Some farmers are trying to reduce the risk of bird-flu outbreaks by sending their turkeys to market earlier, and at lower weights than usual, according to analysts at agriculture lender

CoBank.

That has contributed to lower overall production, they said. Excessive heat this summer, which makes it harder for turkeys and chickens to gain weight, also tightened the turkey-meat supply, industry officials said.

Cargill Inc., the third-largest turkey processor, hasn’t been hit by the bird-flu outbreak as badly as others, said Tom Windish, president of Cargill’s primary business division, which oversees turkey. The company this summer started getting more orders from retailers looking for suppliers with turkeys, he said.

To help keep prices lower for consumers, Cargill is shipping more packages to retailers with less turkey in each one, Mr. Windish said. Cost-conscious customers may also opt for smaller turkeys this Thanksgiving to keep their spending down, he said.

A 2015 avian-influenza outbreak, the deadliest on record—it led to the death of about 50 million birds—ended in the middle of that year, and turkey-industry officials have said they hoped the same would hold this year.

Ms. Breeding, of the National Turkey Federation, said that in 2015 there were brief interruptions in the availability of some turkey items, but these were resolved before the holiday season.

After months of declining cases among commercial poultry flocks, the USDA confirmed several outbreaks this past week in California, leading to the death of nearly 400,000 turkeys. The Minnesota Board of Animal Health also confirmed that a commercial turkey flock was culled this past week in response to a bird-flu case. The timing of the detection was sooner than anticipated, said Shauna Voss, senior state veterinarian in Minnesota.

Entire poultry flocks are destroyed after an infection is confirmed to help limit the spread.

Warm weather has slowed the spread of the virus in the past, but the recent cases in California suggest that this strain may be more resistant to heat, analysts said.

Following the 2015 outbreak, the USDA upgraded its virus testing and detection systems, training and equipment, officials have said. Some farmers invested in new biosecurity systems for their barns meant to disinfect anyone who walks into the tightly sealed poultry houses so as not to track in wild-bird fecal matter. Despite the changes, farmers and USDA officials have struggled to halt this year’s outbreak.

“All we can do is concentrate on our operations,” said Cargill’s Mr. Windish.

Write to Patrick Thomas at [email protected]