USDA Lowers 2014 Meat Production Estimate

USDA lowered its projection for 2014 total US meat production as declines in beef output overwhelmed the effect of heavier beef carcasses, higher hog slaughter and weights and steady poultry production.

In its monthly World Agricultural Supply and Demand Estimates report Wednesday, the USDA total red meat and poultry production for 2014 would be 92.043 billion pounds, down from its projection in the November report of 92.115 billion.

Beef production for the year was estimated at 24.254 billion pounds, down 205 million pounds, or 0.84%, from 24.459 billion in the November estimate.  A lower fourth-quarter production estimate via reduced slaughter was cited.  The USDA projected production of 6.025 billion pounds, compared with the November estimate of 6.230 billion.

First-quarter 2015 beef production was seen at 5.650 billion pounds, a drop of 375 million from the new fourth-quarter estimate of 6.025 billion, a fall of 6.64%.

Weekly federally inspected cattle slaughter has been below the comparable week a year ago in all but two weeks this year.  Last year saw a dramatic decline the last two weeks of the year, so USDA economists must be looking at an earlier and/or sharper drop this year.

Annual pork production was projected to be 22.792 billion pounds, up 130 million, or 0.57%, from an estimated 22.662 billion in the November WASDE report.  Fourth-quarter production, at 6,080 billion pounds, up from 5.950 billion a month ago.

Weekly federally inspected hog slaughter this year has been below a year ago since the last week of February.  It also nosedives during the holidays, but with hog inventories higher, USDA economists may see this year’s late-December slaughter drop as less severe.

Of note is the fact that fourth-quarter pork production is expected to surpass beef production.

Total 2014 poultry production was estimated at 44.748 billion pounds, up slightly from the November forecast of 44.746 billion.  And fourth-quarter poultry output was kept at 11.380 billion pounds, as chicken and turkey production were left unchanged.




Because of the lowered expected domestic beef production, US beef imports were projected higher in Wednesday’s WASDE report, although the beef export projection was left unchanged.

Beef imports for 2014 were projected at 2.848 billion pounds, up 25 million, or 0.89%, from the November projection of 2.823 billion.  Next year’s import projection was left unchanged at 2.525 billion pounds.

The Australian Bureau of Agricultural and Resource Economics Tuesday projected Australian beef exports to the US would expand as the US worked to rebuild its herd from 63-year lows.

Pork imports for 2014 also were raised, to 1.008 billion pounds, and pork exports were expected to decline to 4.966 billion from 5.066 billion a month ago.

USDA economists said relatively high pork prices were expected to encourage imports and limit sales opportunities.

The WASDE report also raised its 2015 estimated pork import projection to 910 million pounds from the November estimate of 900 million.




Cattle price projections were raised in the December report on continued demand strength and tight cattle supplies, the USDA said.

Average slaughter steer prices for 2014 were projected at $155.29 per cwt, up from the November forecast of $154.41.  Fourth-quarter prices were estimated in a range from $167 to $170, compared with $163 to $167 in the November report.

However, barrow and gilt prices were expected lower.  The USDA saw an annual average price of $76.22 per cwt, down from $76.60 in the November report.

The USDA didn’t say, but increased supply via larger imports and lower exports may be behind the lowered price projections for hogs.