USDA Lowers Total Meat Production Forecast

The USDA Wednesday lowered its forecast for total meat production for this year and next, saying beef and chicken production will decline while pork holds steady.

In its monthly World Agricultural Supply and Demand Estimates, USDA economists said 2015 and 2016 beef production would be lower than its July forecast because of a combination of slower fed cattle marketings and reduced cow slaughter.  Total beef production for 2015 was put at 23.759 billion pounds, down 2.03% from 24.252 million last year.

But even though the beef production estimate was lowered, estimated 2015 prices for slaughter-ready steers declined in the latest WASDE report to a range of $154 to $158 per cwt on a live basis from the July estimate of $158 to $162.

The total pork production estimate was put at 24.581 billion pounds, unchanged from the July estimate but up 7.61% from 2014 production of 22.843 billion.

Price expectations for barrows and gilts declined to $49 to $50 per cwt from the July estimate of $50 to $51.  Both remain well below last year’s average price of $76.03.

This year’s chicken production estimate of 40.245 billion pounds was lowered from the July estimate of 40.492 billion because growth in the number of eggs set and chicks placed has slowed.  Production last year was 38.550 billion.

Broiler prices were expected to decline, limiting production growth.  No change was made to the 2016 production estimate.

However, the 2015 egg production estimate was lowered as second-quarter egg production was down from last year.  Market sources say egg producers hit with highly pathogenic avian influenza over the winter and spring are just now beginning to come back on line.

 

EXPORT FORECASTS LOWERED

 

Forecasts for beef, pork and poultry exports were lowered from the July estimates while imports of all three were expected to rise as the relative strength of the US dollar makes US goods more expensive for importers and foreign imports cheaper for US shoppers.

The WASDE estimate for total beef exports was seen lower at 2.362 billion pounds, down from the July estimate of 2.436 billion and last year’s 2.573 billion.  Expected imports were raised to 3.467 billion pounds from July’s 3.431 billion and last year’s 2.947 billion.

The estimate for beef ending stocks was left unchanged at 560 pounds.  However, this is down from last year’s 591 million.

The estimate for 2015 pork exports now rests at 4.999 billion pounds, down from the July estimate of 5.065 billion but slightly higher than last year’s 4.857 billion.  Imports were expected to total 1.097 billion pounds, compared with 1.083 billion in the July estimate and 2014 imports of 1.008 billion.

The estimate for pork ending stocks was raised to 650 million pounds from last month’s estimate of 610 million and last year’s 560 million.

 

CASH CATTLE MARKET QUIET

 

Cash cattle markets Wednesday were relatively quiet.  The USDA reported a few scattered sales this week at $150 to $151 per cwt on a live basis and $238 to $239 on a dressed basis.

The markets last week traded at mostly $150 per cwt with some up $2 to $3 to $152 after trading $2 higher the previous week.  On a dressed basis, cattle traded at $236 to $238, up $4 from the previous week.

The USDA’s beef cutout values Wednesday were higher again, following last week’s lead.  The USDA reported its choice cutout at $244.02 per cwt, up $3.09.  Select was reported at $235.45, up $0.65.  Volume was very heavy with 210 loads of fabricated cuts being sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Tuesday was $216.83, up $0.15, compared with Wednesday’s Aug settlement of $213.87, down $0.20.