WASDE: Beef, Pork Production Rising as Milk Slows
LIVESTOCK, POULTRY, AND DAIRY: The 2015 forecast of total red meat and poultry production is raised from last month as higher beef and pork production more than offset lower turkey production. The forecast for broiler production is unchanged. Beef is higher on greater cow slaughter and heavier carcass weights.
Pork production is increased on higher-than-expected first-quarter slaughter and expectations of larger second-half slaughter. USDA’s Quarterly Hogs and Pigs report, released on March 27, estimated the December-February pig crop was 9 percent higher and indicated that producers intend to farrow 2 percent more sows in March-May. Turkey production is reduced based on slaughter and hatchery data to date. The egg production forecast is lowered based on recent hatchery data.
The 2015 beef import forecast is raised from last month as demand for processing grade beef remains strong and strength of the dollar makes the United States an attractive market. Beef exports for 2015 are raised based on trade data to date. Pork exports are unchanged from last month, but the forecast for imports is raised as the strong dollar makes the United States an attractive market despite larger production. The broiler export forecast is lowered. The recovery in exports after U.S.-wide highly pathogenic avian influenza (HPAI)-related restrictions has been limited by weak economic growth in a number of key markets and the strong dollar. Turkey exports are also reduced as the strength of the dollar makes it difficult to expand exports in the face of HPAI restrictions from a number of countries. The egg export forecast is unchanged.
Cattle prices for 2015 are raised as demand for fed cattle remains strong. The hog price forecast is reduced as greater production pressures prices. Broiler prices are unchanged at the midpoint. Turkey prices are lowered. The egg price is raised on strong demand and slightly lower production.
The milk production forecast for 2015 is lowered from last month as growth in output per cow is constrained by dry conditions in the West. Fat basis imports are raised on demand for butterfat, but skim-solids imports are unchanged. Exports are hampered by relatively weak international prices and the strong dollar; thus forecasts for both fat and skim-solids are reduced from last month.
Product price forecasts for butter and cheese are raised on domestic demand strength. However, relatively weak exports of nonfat dry milk (NDM) are expected to pressure prices lower. The whey price forecast is unchanged. The Class III price is raised on the strength of cheese prices, but the Class IV price is reduced as a lower NDM price more than offsets a higher butter price. The all milk price is forecast at $17.10 to $17.60 per cwt.
