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Meat and Poultry ProcessingTurkeySpecial ReportsCoronavirus Coverage

Special Report | State of the Industry 2020

The state of the turkey industry 2020: remaining resilient

By Beth Breeding
turkey cold cuts
October 8, 2020

At the outset of 2020, no one in the turkey industry would have predicted:

  • the foodservice segment would be at a standstill for weeks, decreasing foodservice sales by 60 percent or more;
  • retail demand for protein would have pushed turkey sales into consistent double-digit growth year over year;
  • the supply chain itself would be in doubt for more than a month.

State of the Industry 2020

Overview
Beef (NCBA)
Beef (FQF)
Pork
Chicken
Turkey
Veal
Lamb
Seafood
Food Safety
Workforce
Sustainability
Packaging

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Such is life under COVID-19, as the novel coronavirus went from a few stories in the newspaper as 2019 ended to global pandemic by mid-March. Every person and every business was presented challenges they had never faced before. Nonetheless, the turkey industry’s response to the challenges it has faced during the past several months has been remarkable.

We’ve seen our members focused on continuously innovating to find better ways to protect workers on the job. They’ve met surging demand for protein and all of the materials that go into delivering safe, nutritious products to consumers. Out on the farm, they’re still caring for their flocks. The industry’s resilience has been impressive and it speaks volumes to where we go next.  

 

Lay of the land

The magnitude of the challenge was unprecedented for the industry and for the National Turkey Federation (NTF). Like our members, we have been laser focused on doing everything possible to mitigate COVID-19’s impact on the turkey industry. A series of regulatory actions taken at the outset of the pandemic helped to make certain turkey production was considered an essential industry, to allow for uninterrupted transportation of feed, animals and finished products, and to redirect foodservice products to retail where possible. NTF also worked with federal regulators to ensure plants had the clear guidelines and standards needed to remain operational while protecting workers. Even as COVID-19 has become an everyday fact of life for Americans, NTF continues working with lawmakers and the U.S. Department of Agriculture (USDA) to see the turkey industry is compensated for its COVID-related losses in the same manner as other industries.

ANNUAL TURKEY FORECASTS

2016 2017 2018 2019 2020 2021
Production (million lb.) 5,981 5,981 5,878 5,818 5,708 5,770
Per capita disappearance (retail lb.)* 16.7 16.5 16.2 16.0 15.8 15.7
Turkey exports (million lb.) 569 622 611 639 540 555

Forecasts are in bold. * Per capita meat and egg disappearance data are calculated using the Resident Population Plus Armed Forces Overseas series from the Census Bureau of the Department of Commerce. All data as of Sept 17, 2020. Source: World Agricultural Supply and Demand Estimates and Supporting Materials. For further information, contact: Mildred M. Haley, mhaley@ers.usda.gov

From where we sit in early September, it’s hard for anyone to know how the rest of 2020 will play out. But it is clear that disruptions to foodservice have been significant and will continue to have an impact on the turkey industry as we look toward 2021. Some projections put overall turkey foodservice losses over 20 percent, and it will take time to rebuild that business as the economy reopens. While we’ve seen consistent gains at retail, with ground turkey performing especially well, it is important to remember that growth at the supermarket cannot fully offset the losses at foodservice.

It is too early to tell how all of this will affect turkey production, but it is reasonable to assume some companies have had to make cutbacks to reflect the lost foodservice business and that additional reductions may be on the horizon in 2021, at least until the virus is fully contained.

FROZEN/REFRIG. TURKEY/TURKEY SUBSTITUTE:
TOP 5 RETAIL BRANDS

Brand Dollar Sales Dollar Sales % Chg YAgo Unit Sales Unit Sales % Chg YAgo
Private Labe $338,680,778 17.4% 67,902,251 9.2%
Jennie-O $330,910,569 16.9% 49,474,202 10.5%
Jennie-O All Natural $209,230,791 6.8% 48,004,442 6.8%
Butterball Everyday $202,106,537 22.4% 37,000,461 18.0%
Shady Brook Farms $160,353,510 7.0% 28,207,895 1.4%
Total Frozen/Refrig. Turkey/Turkey Substitute $1,706,231,019 16.8% 319,231,138 11.3%
Total Frozen/Refrig. Poultry $4,750,722,997 17.8% 765,275,208 12.2%

Source: IRI, a Chicago-based market research firm (@iriworldwide). Total US - Multi Outlet w/ C-Store (Grocery, Drug, Mass Market, Convenience, Military and Select Club & Dollar Retailers), latest 52 weeks ending Sept. 6, 2020. Note: Rankings of top brands are NOT totaled brands (e.g. all brand lines/extensions rolled up into a single figure), but rather individual brand lines.

Making lemonade 

Uncertainty remains a factor as we close out 2020, but some chances to make lemonade will emerge from the crisis. Remember the gains in turkey sales at retail? That represents an opportunity to reinforce shopping and cooking habits, such as increased turkey use, that were developed over the past few months as consumers prepared meals at home. Plus, more frequent at-home meal prep is expected to extend beyond the pandemic. NTF plans to continue our marketing efforts to help introduce consumers to simple, delicious ways to try turkey, whether it’s a one-skillet dinner or a bone-in turkey breast smoked to tender perfection.  

Going into the holiday season, a socially distanced Thanksgiving is a new concept, but the tradition of turkey as the table centerpiece is one the industry is certain will continue. It’s also an opportunity for the turkey industry to highlight the versatility of our products for what might be smaller gatherings and engage new home cooks with Thanksgiving meal preparations. 

REFRIGERATED SLICED LUNCHMEAT:
TOP 5 RETAIL BRANDS

Brand Dollar Sales Dollar Sales % Chg YAgo Unit Sales Unit Sales % Chg YAgo
Private Label $1,107,295,297 8.7% 269,089,972 4.3%
Oscar Mayer Deli Fresh $771,369,307 6.0% 159,312,250 -1.8%
Oscar Mayer $764,072,957 0.8% 216,812,863 -3.0%
Hillshire Farm $598,983,668 27.1% 138,546,383 23.6%
Land O'Frost Premium $319,111,921 6.9% 77,872,774 6.2%
Total Refrig. Sliced Lunchmeat $5,906,986,701 7.7% 1,606,902,096 1.9%
Total Luncheon Meats $6,184,436,470 8.0% 1,668,314,336 2.2%

Source: IRI, a Chicago-based market research firm (@iriworldwide). Total US - Multi Outlet w/ C-Store (Grocery, Drug, Mass Market, Convenience, Military and Select Club & Dollar Retailers), latest 52 weeks ending Sept. 6, 2020. Note: Rankings of top brands are NOT totaled brands (e.g. all brand lines/extensions rolled up into a single figure), but rather individual brand lines.

Taking the lessons learned from 2020 will help us prepare for future situations. Finding balance will remain key to the industry as we move forward.

NTF is grateful for the hard work and dedication of the men and women on the farm, in the plant and everywhere in between who play a role in the production, processing and delivery of turkey products. It’s because of them that we know the state of the industry remains resilient in this crisis. NP

KEYWORDS: COVID-19 National Turkey Federation state of the industry turkey meat production

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Beth Breeding is the vice president of Communications & Marketing for the National Turkey Federation. Contact her at BBreeding@turkeyfed.org or (202) 898-0100, ext. 9639.

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