WASDE: Red Meat and Poultry Production Higher, Milk Lowered
LIVESTOCK, POULTRY, AND DAIRY: The 2016 forecast of total red meat and poultry production is raised from last month as higher forecast first-quarter broiler and turkey production more than offsets small reductions in beef and pork. First-quarter beef production is reduced on the pace of slaughter and lower carcass weights; pork production is reduced on slightly lighter carcass weights. Broiler and turkey production for the first quarter is raised as the pace of slaughter to date has been higher than expected. The egg production forecast is raised on increased table egg production as the sector continues to rebuild following last year’s Highly Pathogenic Avian Influenza outbreaks. Historical poultry and egg production estimates are adjusted to reflect revisions in production data.
Beef import and export forecasts are unchanged from last month. The pork export forecast is lowered from last month on recent trade data. The pork import forecast is raised on expectations of relatively large exportable supplies in the EU and continued strength of the U.S. dollar. Broiler export and turkey export forecasts are lowered on slower-than-expected sales in January.
Annual cattle and hog prices for 2016 are unchanged from last month. Broiler prices are lowered on current prices and expected higher production. The turkey price forecast is unchanged but the range is narrowed. Egg prices are reduced on higher forecast production.
The milk production forecast for 2016 is lowered from last month as a smaller decline in the cowherd is more than offset by slower growth in milk per cow. Fat and skim-solids basis exports are reduced primarily on strong competition in international whey product markets, and exports of a number of other dairy products are facing increased competition. Imports are increased on both a fat and skim-solids basis. Continued strength of the U.S. dollar is expected to keep the United States as an attractive market for dairy products. Expectations of a relatively wide spread between U.S. and international butter prices will support increased butterfat imports while cheese imports will likely benefit from continued demand strength. Whey product exports are also likely to be pressured by large world supplies.
The butter price forecast is raised as demand remains firm. Cheese and nonfat dry milk (NDM) prices are reduced as supplies are expected to be large and in the case of NDM, international prices will remain under pressure from large global supplies. The whey price forecast is unchanged. The Class III price is lowered on the lower cheese price. The Class IV price is unchanged at the midpoint as the higher butter price offsets a lower NDM price; however, the range is narrowed. The all milk price forecast is lowered to $14.95 to $15.55 per cwt.
