(C) Reuters. A Diestel family member stands at Diestel Family Turkey Ranch in Sonora, California, U.S. in this undated handout photo obtained on November 9, 2021. Diestel Family Ranch/Handout via REUTERS
By Tom Polansek and Christopher Walljasper
CHICAGO (Reuters) – U.S. Thanksgiving feasters are paying premium prices for turkeys this year, after more farmers were cautious with production, figuring a second pandemic holiday could slash demand.
The price of frozen whole uncooked turkeys in the four weeks before Nov. 6 rose 15.6% from the same period in 2020, according to data from research firm NielsenIQ.
Fewer turkeys were produced this year, so turkey meat prices have soared at a time consumers are already grappling with rising inflation with the global supply chain stumbling into the holiday shopping season.
Last year, food companies and farmers predicted many consumers would downsize Thanksgiving because of the pandemic. This year, vaccinations eased worries for some while the fast-spreading Delta variant kept others cautious.
Turkey farmers begin considering the size of their flocks for Thanksgiving up to a year ahead of time. Since then, they have confronted skyrocketing costs of grains and soybeans eaten by the birds.
Diestel Family Ranch, which produces turkeys in Sonora, California, raised birds of about the same size for 2021 as it did for 2020, farmer Heidi Diestel said, avoiding guesses on how the pandemic would change demand. The ranch added a few extra petite birds that weigh six to 10 pounds, she said, because they can be eaten year round if not sold for the holidays.
“Trying to predict this crazy world seemed like we should leave that to others,” Diestel said. “We didn’t really want to go there.”
Butterball, the largest U.S. turkey producer, normally surveys consumers once a year to gauge Thanksgiving plans. This year, however, it peppered customers with questions again, after the Delta variant started spreading.
By September, it found consumers turning more cautious about larger gatherings, after showing enthusiasm in June for celebrations with extended family and friends, said Al Jansen, an executive vice president.
After about two months of declining infections, the United States has reported daily increases for the past two weeks as temperatures drop and people spend more time indoors.
“Everybody still wants to celebrate Thanksgiving,” Jansen said. “What altered was the type of celebration.”
Frozen inventories of hen turkeys, female birds that are normally smaller in size, and turkey breasts fell to record lows this year and were down 19% and 51% from last year by the end of September, respectively, the U.S. Department of Agriculture said.
The agency said wholesale hen turkey prices in September reached about $1.44 per pound, the highest level since recordkeeping began in 2005. Supplies of bigger tom turkeys in cold storage facilities are up, according to official data.
“Smaller sizes may not be as plentiful as previous years because of all the collateral damage from the pandemic,” Butterball’s Jansen said.
U.S. farmers had already been cutting turkey production before the pandemic due to declining profits, economists said. They raised 214 million turkeys in 2021, down 4% from 2020 and down 13% from 2018.
Last year, consumers swapped out orders for whole birds for smaller turkey breasts heading into Thanksgiving amid surging COVID-19 cases.
This year, higher food prices may also be encouraging a preference for smaller birds, said Spencer Shute, senior consultant for consultancy Proxima in Boston.
A Farm Bureau survey from Oct. 26 to Nov. 8 showed Thanksgiving dinner will cost U.S. consumers an average of 14% more this year, the biggest annual increase in 31 years.
The item that saw the biggest price increase? Turkey.