Global Beef & Energy Outlook. Gregg Doud Chief Economist National Cattlemen s Beef Association

Transcription

1 Global Beef & Energy Outlook Gregg Doud Chief Economist National Cattlemen s Beef Association

2 Source: USDA/FAS TOP 4= 71%

3 Brazil Russia India China

4 Global Beef Trends Source: USDA/FAS, CattleFax Projections, EU-27 equivalents

5 Source: USDA/FAS

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13 Increasing Protectionism

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27 Year Year-by-Year Renewable Fuels Standard (in billion gallons) Total RFS Corn Eligible Total bushels of corn Advanced Biofuels Cellulosic Biodiesel

28 Ratio 4.00 US SOYBEAN-TO-CORN & SOYBEAN-TO-WHEAT FARM PRICE RATIOS PRX_B_US_BA, GTB-07-09, Sep Soybean-to-Corn Ratio, actual Soybean-to-Corn Ratio, forecast by historical seasonality Soybean-to-Wheat Ratio, actual Soybean-to-Wheat Ratio, forecast by historical seasonality Farm price ratio of soybeans to corn for next March neutral, but ratio of soybeans to wheat favors wheat Mar- 91 Mar- 92 Mar- 93 Mar- 94 Mar- 95 Mar- 96 Mar- 97 Mar- 98 Mar- 99 Mar- 00 Mar- 01 Mar- 02 Mar- 03 Mar- 04 Mar- 05 Mar- 06 Mar- 07 Mar- 08

29 s Thousand acres US MAJOR CROPS PLANTED AREA PRX_US_APanal, GTB-07-09rev, Sep CRP_actual Other feedgrains_actua l Wheat_actual Other Oilseeds_actual Soybeans_actual Corn_actual Corn + Soybeans "Max" Blue Sky Model constrains the sum of corn and soybean planted area to a maximum of about 161 million acres (with only 1-2 million acres leaving CRP in near-term)

30 U.S. Meat Exports +20 % +53 % +33 % Source: USDA/ERS

31 Mil. Pounds 530 PORK PRODUCTION Federally Inspected, Weekly Avg JAN APR JUL OCT M-S-19 10/17/08 Livestock Marketing Information Center

32 U.S. Pork Exports All Others Source: U.S. Dept of Commerce

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34 HOG CUTOUT VALUE Weekly $ Per Cwt JAN APR JUL OCT Avg H-P-10 10/13/08 Livestock Marketing Information Center

35 Mil. Lbs 1000 BROILER PRODUCTION Federally Inspected, Weekly Avg JAN APR JUL OCT Livestock Marketing Information Center P-S-20 10/17/08

36 U.S. Poultry Exports Source: U.S. Dept of Commerce

37 Cents Per Pound JAN WHOLESALE CHICKEN LEG PRICES Northeast, Truckload, Weekly APR JUL OCT Avg P-P-03 10/06/08 Livestock Marketing Information Center

38 Cents Per Pound 180 WHOLESALE CHICKEN BREAST PRICES Skinless/Boneless, Northeast, Truckload, Weekly Avg JAN APR JUL OCT P-P-02 10/06/08 Livestock Marketing Information Center

39 Mil. Eggs 225 BROILER EGGS SET Weekly Avg JAN APR JUL OCT Livestock Marketing Information Center Data Source: USDA/NASS P-S-10 10/17/08

40 Mil. Pounds 575 BEEF PRODUCTION Federally Inspected, Weekly Avg JAN APR JUL OCT M-S-18 10/17/08 Livestock Marketing Information Center

41 Mil. Pounds 1050 TOTAL RED MEAT PRODUCTION Federally Inspected, Weekly Avg JAN APR JUL OCT M-S-21 10/17/08 Livestock Marketing Information Center

42 U.S. Beef Exports Mexico Canada Source: U.S. Dept of Commerce, forecasts by CF

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44 Value of Exports to S. Korea Short Rib Value Per Head Avg Source: USDA, CattleFax Prices of 123A and 130 choice ribs * 5 lbs/head each

45 Chuck Price and S. Korean Shipments Source: USDA, U.S. Dept of Commerce

46 Russian Meat Production Source: USDA/FAS

47 Russia World s biggest meat importer Second larger beef importer behind the U.S. Stock Market down 78% Renegotiating its WTO Accession commitments Poultry Pork

48 World Beef Report

49 Brz Real and US$ in Russian Rubles (indexed at Jan 2003) Recent US dollar rally 86% Sprea d Source: Pacific Exchange Rate Service

50 31 Day FX Rates Beef Markets 2008 by Werner Antweiler, University of British Columbia.

51 $/HEAD Fed Cattle Profit/Loss Source: CattleFax YEARS

52 Mil. Head 2.8 FEEDLOT PLACEMENTS US Total, Monthly Avg JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Livestock Marketing Information Center Data Source: USDA/NASS C-N-08 10/17/08

53 Mil. Head 12.5 CATTLE ON FEED US Total, Monthly Avg JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Livestock Marketing Information Center Data Source: USDA/NASS C-N-10 10/17/08

54 Mil. Head 1.8 CATTLE PLACED WEIGHING LESS THAN 700 POUNDS 1,000 Plus Capacity Feedlots, U.S., Monthly Avg JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Livestock Marketing Information Center Data Source: USDA/NASS C-N-08A 10/17/08

55 Mil. Head 1.5 CATTLE PLACED WEIGHING MORE THAN 700 POUNDS 1,000 Plus Capacity Feedlots, U.S., Monthly Avg JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Livestock Marketing Information Center Data Source: USDA/NASS C-N-08B 10/17/08

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57 Breakeven Purchase Price 750 lb Steer Corn Price $/bu Fed Price $49 $49 $ $638/hd $26 $26 $26 $26 $26 $589/hd $540/hd $490/hd

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64 000 HEAD 40,000 39,000 38,000 37,000 36,000 35,000 34,000 33,000 32,000 31,000 30,000 Beef Cow Inventory Source: USDA Projected 2009 YEARS

65 Cost per Head $1,200 $1,000 $800 $600 $400 Cost to Raise and Finish a Fed Steer From 2005 to 2008 F: Per head costs increase $439, or $34/cwt live, or $54/cwt carcass wt, or $0.78/lb retail $726 $202 $90 $792 $227 $107 $935 $317 $123 $1165 $486 $140 $200 $413 $431 $460 $497 $ F Calf cost (cash) 200# background 550# feedyard

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68 MED. & LRG. #1 STEER CALF PRICES Pounds, Southern Plains, Weekly $ Per Cwt Avg JAN APR JUL OCT Livestock Marketing Information Center C-P-49A 10/09/08

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70 Cost Inflation: 2008 vs Crude 290% Corn Nitrogen Pasture land 141% 176% 205% Hay 65% 550# Str 15% 0% 100% 200% 300% 400% Change since 2000

71 Weekly Corn Futures 10/22/2008 Advanced Economic Solutions 71

72 Weekly Live Cattle Futures 10/22/2008 Advanced Economic Solutions 72

73 Weekly Live Hogs Futures 10/22/2008 Advanced Economic Solutions 73

74 Weekly Crude Oil Futures 10/22/2008 Advanced Economic Solutions 74

75 Weekly Natural Gas Futures 10/22/2008 Advanced Economic Solutions 75

76 Weekly Ethanol Futures 10/22/2008 Advanced Economic Solutions 76

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81 NINJA

82 Mortgage Resets January 2007 $22 (billion) February 25 March 35 April 37 May 36 June 42 July 43 August 52 September 58 October 55 November 52 December 58 Jan February 88 March 110 April 92 May 76 June 75 July 50 August 35 September 26 October 20 = $907 billion

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84 Signs of Easing In The Financial Gridlock Last Week LIBOR vs. T-Bills (3-Month) 1/2 2/2 3/2 4/2 5/2 6/2 7/2 8/2 9/2 10/2 October 2008 Advanced Economic Solutions 84

85 Source: USDA

86 Which is it? Stock Markets? Exchange Rates? Energy Prices? Demand Destruction? Freight Rates? Drought? Supply & Demand of Competing Meats? Corn & Soybean Prices? Ethanol? Speculators? Profitability? Environmental, Animal Welfare, Food Safety, COOL?

87 Average Cow/Calf Profit (Loss) 2008 Declining Profitability $ / H E A D Source: Cattle-Fax 2008 Projected YEARS