While most agriculture markets parsed the bullishness or bearishness of Tuesday’s USDA’s World Agriculture Supply and Demand Estimates report, many skimmed over the bullish aspects of the report to livestock markets.
The report lowered its estimate for total red meat and poultry production this year from last month’s estimate. Forecasts for all major meats were reduced.
The 2018 beef production forecast was reduced by 50 million pounds, or 0.18%, to 27.635 billion from 27.685 billion in the March report on lower-than-expected first-half slaughter and lighter-than-expected slaughter weights, the report said. However, this decline was offset partly by higher-than-previously expected third-quarter slaughter.
Annual beef import and export estimates were left unchanged from last month at 3.040 billion pounds and 3.025 billion pounds, respectively.
Cattle price forecasts were reduced from the March report as demand for cattle has softened, and supplies were expected to be large in coming quarters, the report said. Steer prices for the year were estimated in a range from $114 to $119 per cwt, compared with $116 to $123 in the March report.
The first-quarter 2018 pork production estimate was raised to 6.655 billion pounds from March’s 6.590 billion based on estimated production data but was lowered for outlying quarters on a slower pace of slaughter and lighter carcass weights, the report said. The result was a 2018 production estimate of 26.805 billion pounds, down 105 million, or 0.39%, from 26.910 billion in the March report.
The USDA’s Quarterly Hogs and Pigs Report of March 29 estimated that producers farrowed 2% more sows in the December-through-February quarter and indicated intentions to farrow about 2% more during the March-through May period. The USDA said. These hogs will be ready for slaughter in the second half of this year.
The annual pork import forecast was left unchanged at 1.065 billion pounds, although the 2018 pork export forecast was reduced 25 million, or 0.42%, from the March report to 5.900 billion on weaker expected exports to China although exports to other markets were expected to increase.
The 2018 hog price forecast was reduced from the previous report. As with cattle, demand for hogs has softened, and supplies were expected to be large in coming months.
The annual 2018 price
The USDA said its estimate for 2018 chicken and turkey production was reduced to 48.835 billion pounds from the March estimate of 49.115 billion, because of recent hatchery data. This was a decline of 280 million pounds, or 0,57%.
No change was made to chicken and turkey export forecasts of 6.950 billion pounds and 645 million pounds, respectively.
The broiler price forecast was raised to a range of 93 to 98 cents a pound from 89 to 94 cents last month as stronger first-quarter demand was expected to carry through the next quarters.
Turkey prices were reduced to 82 to 86 cents a pound because of a continued sluggish growth in demand.
CATTLE, BEEF RECAP
Cattle sold last Wednesday on the Livestock Exchange Video Auction at $117 per cwt, down $8.63 from two weeks earlier.
Cash trade last week was from $115 to $118 per cwt on a live basis, down $3.50 to $4 from the previous week. Dressed-basis trading was at $188 to $190, down $2 to $4.
The USDA’s choice cutout Tuesday was down $1.53 per cwt at $213.51, while select was off $1.81 at $201.33. The choice/select spread widened to $12.18 from $11.90 with 136 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Monday, was $134.81 per cwt, up $0.32. This compares with Tuesday’s Apr settlement of $134.82, up $0.37.