It’s no secret that US meat production was down in April as packing plant after packing plant closed because of the COVID-19 virus, but a look at the numbers drives the point home.
The USDA’s National Agricultural Statistics Service said monthly beef, pork and poultry production plummeted in April, dropping well below last year and the 2014-2018 average. Production in May also was strained, and year-to-year comparisons may be just as striking.
COMMERCIAL BEEF PRODUCTION DROPS
US commercial beef production hit a monthly 2020 high in March at 2.411 billion pounds, according to NASS data compiled by the Livestock Marketing Information Center. From there, April’s rate of 1.815 billion pounds was off by 596 million, or 24.7% — in one month.
But April’s commercial beef production also was 447 million pounds, or 19.8%, below April 2019’s 2.262 billion pounds, the data showed. In addition, April’s production was 188 million pounds, or 9.39%, below the previous five-year average of 2.003 billion.
Despite the sudden drop in cattle slaughter and beef production in April, the number of cattle on feed May 1 was down 5% from a year earlier at 11.200 million head. Market analysts at the time pointed to slightly lower placements of younger cattle into feedlots as fed-cattle prices plummeted, although April placements were down only 1% from a year earlier.
AMS data also showed that the percentage of choice to select beef produced continued to widen through March when 74.8% of graded beef produced was choice and 14.4% was select. This continues a slow, uneven progression of basically steady production of choice beef and a decline in the percentage of select beef produced.
COMMERCIAL PORK PRODUCTION ALSO DOWN
April commercial pork production also was slashed from March’s 2020 high, although it didn’t quite drop below the 2014-2018 average, the data showed.
For April, production hit 2.031 billion pounds, down 536 million, or 20.9%, from 2.567 billion in March and down 238 million, or 10.5%, from April 2019’s 2.269 billion. However, it was 9 million, or 0.45%, above the previous five-year average of 2.022 billion.
The 2014-2018 average shows a seasonal decline in hog slaughter through June. But since April’s sharp drop in slaughter was predicated on closed packing plants and slowed chain speeds because of COVID-19 among plant employees, this year’s trend line could show an unseasonal bounce in slaughter, a market analyst said.
The annual peak in hog slaughter comes in October, but this year’s COVID-related disruptions could change it this year, the analyst said.
CHICKEN PRODUCTION DOWN, NOT OUT
Chicken production in April also declined, but the dip wasn’t as noticeable on a monthly line graph. Production was pegged at 3.634 billion pounds, down from March’s 3.908 billion. However, it was above a year ago’s 3.633 billion and the 2014-2018 average of 3.350 billion.
CATTLE, BEEF RECAP
Fed cattle sold this week in the Plains at $97 to $98 per cwt on a live basis, down $1 to $7 from last week, and at $152 to $156 dressed, down $5 to $11.
The USDA choice cutout Wednesday was down $2.12 per cwt at $209.69, while select was off $1.88 at $201.69. The choice/select spread narrowed to $8.00 from $8.24 with 142 loads of fabricated product sold into the spot market.
Three heifer and three steer contracts were tendered for delivery Wednesday against the Jun live cattle futures contract at zero. All were demanded.
The CME Feeder Cattle index for the seven days ended Tuesday was $129.12 per cwt, up $0.41. This compares with Wednesday’s Aug contract settlement of $132.87, down $0.32.