USDA Raises Red Meat Production Estimates

The USDA Tuesday raised its estimate of total red meat and poultry production from last month as higher expected cattle slaughter and heavier carcass weights more than offset a lower pork production forecast.

The USDA changed its production estimates in its monthly World Agricultural Supply and Demand Estimates report.

The USDA’s World Agricultural Outlook Board made no changes to its broiler and turkey production forecasts.  It used estimates for hog and pork production from the Quarterly Hogs and Pigs report from March 25 to estimate that first-quarter growth in pigs per litter was slower than expected and that producers expected to farrow fewer sows in March-May than was previously planned.




The WASDE report estimated 2016 beef production at 24.825 billion pounds, up 1.2% from the March 9 estimate of 24.540 billion.  The latest estimate also is up 4.8% from 2015 production of 23.690 billion pounds.

Each quarter’s beef production was expected to exceed the same 2015 quarter.  First-quarter production was seen at 5.945 billion pounds, up 281 million, or 4.96% from last year’s 5.664 billion; second-quarter production was expected to be 6.190 billion pounds, up 335 million, or 5.72%, from the 2015 quarter’s production of 5.855 billion; third-quarter production was estimated at 6.395 billion pounds, up 329 million, or 5.42%, from 2015’s 6.066 billion, and fourth-quarter production was estimated at 6.295 billion pounds, up 190 million, or 3.11%, from last year’s 6.105 billion.




By comparison, 2016 pork production was estimated at 24.970 billion pounds, maintaining is lead over beef.  The new number is down 0.2% from the March estimate of 25.025 billion but is up 471 million, or 1.92%, from 2015’s production of 24.499 billion.

As with beef, quarterly pork production was expected to be above year-earlier numbers in every quarter this year.  First-quarter production of 6.240 billion pounds was expected to be 79 million, or 1.28%, above last year’s 6.161 billion.  Second-quarter production was estimated at 5.935 billion pounds, up 10 million, or 1.90%, from 5.925 billion in last-year’s quarter.  Estimated third-quarter production of 6.170 billion pounds would be 213 million, or 3.58%, above the 2015 quarter’s 5.957 billion.  And fourth-quarter production of 6.625 billion pounds would be 169 million, or 2.62%, above last year’s 6.456 billion.




Farm-gate prices for slaughter cattle this year were expected to range from $131 to $137 per cwt on a live basis, down from last year’s $148.12 and down from March’s estimated range of $133 to $142.

Quarterly price estimates were forecast to be down from a year ago through the third quarter.  Only in the fourth quarter were prices expected to rise above a year ago when projections called for a range of $129 to $139 versus the 2015 quarter’s $127.71.




Cash cattle markets remained quiet Tuesday as packer buyers showed no interest in bidding.  Asking prices were around $136 to $138 per cwt on a live basis and $218 or more on a dressed basis.

Business last week was at $132 per cwt up to $136 on a live basis with most around $133 to $134, steady to up $2.  In dressed markets, cattle traded at a steady $214 to $216.

The USDA’s choice cutout price Tuesday was up $2.86 per cwt at $219.31, and select was up $2.59 at $209.64.  The choice/select spread widened to $9.67 from $9.40 as 123 loads of fabricated product were sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Monday was $157.68 per cwt, down $0.18.  This compares with the Apr CME settlement Tuesday of $155.27, down $0.27.