The USDA expects total meat production for 2015 and 2016 to be close to previous estimates as economists predict a decline in beef and pork output and an increase in poultry production.
The USDA made the predictions Tuesday in its monthly World Agricultural Supply and Demand Estimates report, which lowered its forecast for 2015 red meat production by 151 million pounds, or 0.31%, to 48.457 billion from 48.608 billion. Total 2015 poultry production was raised 200 million pounds, or 0.43%, to 46.294 billion from 46.094 billion.
For 2016, total red meat production was estimated at 50.004 billion pounds, down 110 million, or 0.22%, from the October projection of 50.114 billion. Total poultry production for the year was forecast at 47.525 billion pounds, up 50 million, or 0.11%, from the October estimate of 47.475 billion.
BEEF PRODUCTION FORECAST DOWN
The USDA’s annual beef production forecast for 2015 was lowered to 23.715 billion pounds, a decline of 79 million, or just 0.33%, from the October estimate of 23.794 billion. The 2015 output was down 537 million, or 2.21%, from 2014’s 24.252 million.
The annual beef production forecast for 2016 was lowered to 24.850 billion pounds, compared with the October estimate of 24.960 billion. However, the 2016 beef production estimate was up 1.135 billion pounds, or 4.79%, to 24.850 billion from the 2015 production estimate.
The USDA said it expected slower marketings of fed cattle from feedlots into early 2016. However, the decline in finished cattle slaughter was expected to be offset somewhat by larger expected carcass weights.
Fourth-quarter 2015 beef production of 6.130 billion pounds was expected to give way to first-quarter 2016 beef production of 5.915 billion, a decline of 215 million pounds, or 3.51%.
Price expectations for fed steers this year were left unchanged from the October estimate at $149.19 per cwt. USDA economists also left unchanged their estimate of 2016 fed cattle prices at $136 to $147 per cwt.
PORK PRODUCTION FORECAST MIXED
The USDA’s estimate of total 2015 pork production was lowered from its October estimate, but production for 2016 was expected to rise as second- and third-quarter production eclipses the 2015 quarters.
Slower expected slaughter and slightly lighter carcass weights during the fourth quarter of 2015 spill over into the first quarter of 2016, the USDA said.
The pork production forecast for 2016 was left unchanged from the October estimate at 24.925 billion pounds, continuing this year’s anomaly of pork production outstripping beef.
2015 pork production was estimated at 24.508 billion pounds, down 73 million pounds, or 0.30%, from the October estimate of 24.581 billion. However, this was up 1.665 billion, or 7.29%, from 2014’s 22.843 billion.
Pork production was expected to decline in the first quarter of 2016 to 6.150 billion pounds from fourth-quarter 2015 production of 6.465 billion. This also is down slightly from first-quarter 2015 pork production of 6.161 billion.
CASH FED CATTLE MARKETS REMAIN QUIET
Plains direct fed cattle markets remained quiet Tuesday with the USDA reporting only 240 head moving at $200 per cwt on a dressed basis. Trade sources say this was a single transaction that took place in Iowa where cattle traded last week in a range from $205 to $208.
The markets traded in a wide range last week from mostly $133 to $135 per cwt, while on a dressed basis, prices were mostly $204 to $206. In the Corn Belt, cattle traded at $130 to mostly $131 live and $205 to $208 dressed.
Wholesale beef prices Tuesday were up a little, with the USDA choice cutout value at $216.57 per cwt, up $0.12 on the day, and its select cutout at $206.94, up $0.25.
The choice/select spread narrowed to $9.63 from $9.76 on Monday, and there were 91 loads of fabricated product sold into the spot market.
The CME Feeder Cattle Index for the seven days ended Monday was $185.88 per cwt, down $2.59. This compares with the Nov settlement Tuesday of $171.55, down $5.57.