Retail and wholesale turkey prices are breaking with past Thanksgiving trends, leading to growing retail markups

This chart shows the U.S. retail and wholesale turkey prices and retail markup through July 2019.

Thanksgiving meals typically include such iconic dishes as pumpkin pie and stuffing, and roast turkey is usually the centerpiece. This year and last, wholesale turkey prices have been sharply lower than in years past. Do lower wholesale prices mean lower turkey prices at the grocery store? Not always. While wholesale and retail turkey price movements are historically correlated on a yearly basis, seasonal factors can disrupt this correlation. Commonly in the past, retail turkey prices during the Thanksgiving holiday season were near annual low points, while wholesale prices were near yearly highs. Between 2014 and 2016, the November markup from wholesale to retail prices for turkey averaged 18 percent, compared with an average 40-percent markup over the entire 5-year period. Beginning in 2017, however, wholesale turkey prices began a sustained decline that was not reflected in retail price movements. The retail markup in November 2017 reached 75 percent and remained high at 70 percent in November 2018. The markup is expected to remain high in 2019 but should contract slightly due to rising wholesale prices. The data suggest that the past relationship between wholesale and retail Thanksgiving turkey prices may be fading, as retail prices have become less responsive to downward movements in wholesale prices. This chart appears in the ERS Livestock, Dairy, and Poultry Outlook newsletter released in September 2019.

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