The cost of protein in our diets is likely to go up this year amid tight supplies of red meats, the USDA said Monday.\r\n In its monthly World Agricultural Supply and Demand Estimates report, the USDA said it expected a little more beef production, but this would be more than offset by lower pork, chicken and turkey production. The result would be a projected fed cattle price range of $132 to $140 per cwt on a live basis versus $129 to $138 forecast in January and 2013’s $125.89.\r\n Average 2014 cattle prices were raised in the report because of continued tight supplies. Recent record-high cattle prices also were cited as an indicator of things to come.\r\n Hog prices were expected to rise as well amid declining supplies and strong demand, possibly influenced by high beef prices. Hog slaughter estimates were lowered amid reports that Porcine Epidemic Diarrhea virus (PEDv) continues to spread, the USDA said.\r\n Chicken, turkey and egg prices also are expected to rise on demand strength and lower supplies of competing meats. The USDA said chicken slaughter was expected to decline, and even turkey production is expected to decline as recent egg sets and poult placements remain below a year ago.\r\n Beef imports and export predictions were not changed from January’s report, but pork export forecasts were lowered on ideas that higher prices would limit foreign demand.\r\n The chicken export forecast was lowered as weaker-than-expected December exports and recent weakness in leg quarter prices may reflect reduced demand, the USDA said.\r\n For grains and oilseeds, the WASDE report held few major surprises, and the market’s reaction was rather tepid.\r\n For AgResource, the biggest surprise was that the USDA was willing to raise US 2014/15 corn exports by 150 million bushels, the largest increase between the January and February reports on record. The jump was a surprise in light of increased competition from South America during the summer.\r\n US soybean imports could rise this year as shipments from Canada jump. The US already has imported a record 7 million bushels from Canada, and AgResource said it could go to 35 to 40 million.\r\n The USDA lowered 13/14 US corn ending stocks by 150 million bushels to a level about 120 million below trade expectations on expectations of increased exports. This, despite China’s rejection of US corn for an unapproved GMO variety since China so far has been able to find destinations for the rejected corn and demand from traditional buyers is strong. \r\n Still, some market analysts like Allendale Inc., said the trade wasn’t buying such strong corn export forecasts.\r\n No fed cattle trading was reported in the Plains, as feedlot showlists swelled with holdovers from last week’s light action. No bids were reported but asking prices were around $144 per cwt live.\r\n Only very light fed cattle trading was reported in the Plains last week at $141 live and $225 dressed. \r\n The USDA’s boxed-beef cutout was mixed Monday with the choice cutout up $0.39 per cwt at $211.16 and the select cutout down $0.18 at $209.01. The choice/select spread widened to $2.15, and there were 97 loads of fabricated product sold into the spot market.\r\n The CME Feeder Cattle Cash Index for the seven days ended Friday is $169.31, down $0.32, while the March futures contract settled Monday at $167.90, up $0.10.\r\n The US Dollar is at its lowest level in almost two weeks ahead of congressional testimony today by US Federal Reserve Chief Janet Yellen as traders look for Fed tapering clues. \r\n
Cattle feeding is pretty straightforward - doing it profitably isn't.