Situation and Outlook for U.S. Livestock, Dairy, and Poultry

Size: px
Start display at page:

Download "Situation and Outlook for U.S. Livestock, Dairy, and Poultry"

Transcription

1 Situation and Outlook for U.S. Livestock, Dairy, and Poultry Presented by Rachel J. Johnson Economic Research Service, USDA AAEA Pittsburgh, PA July 26, 2011

2 Meat Complex Snapshot High livestock prices but feed costs cut into producer margins. Uncertainty and volatility in grain markets Expansion tenuous for livestock sectors but productivity gains lend to some production increases. U.S. consuming less meat...but exporting more.

3 Feed Prices on the Rise $/bu $/ton Farm price of corn Soybean meal 48% protein Alfalfa hay

4 Livestock Prices Lag Crop Price Increases 50.0 ratio Live Animal-Corn Price Ratios Steers/corn Barrow & gilt/corn Broilers/corn

5 Red Meat & Poultry Production Increases Marginally in 2011 billion lbs % -.3% Total poultry Pork Beef

6 Red Meat & Poultry Exports 5 Percent Higher in 2011 billion lbs % + 1.6% Total poultry Pork Beef

7 Declines in U.S. Retail Per Capita lbs per capita Disappearance into % -1.3% Total poultry Pork Beef

8 Beef and Pork Retail Prices Ease Slightly in 2012 Relative to Chicken ratio 3.0 Retail Price Ratios Beef/pork Pork/chicken Beef/chicken

9 Cattle/Beef Lower cattle inventories Decreases in production commence in 2012 Cattle supply to support prices, high calf and feeder cattle prices Retail beef faces relatively lower pork and poultry prices Beef exports booming while supply is the constraint; Imports from Oceania rebound in 2012

10 Beef Cow Slaughter Responding to thousand hd Prices, Now Drought Avg NASS

11

12 Beef Production Chased Down with Lower Inventories million hd 140 billion lbs Cattle and calves Beef production USDA, NASS

13 Fed Cattle Prices Push Higher in 2012, to Average $ /cwt $/cwt Area Steer, All Grades * 2012* 20 0 Q1 Q2 Q3 Q4 Annual average

14 U.S. To Be a Net Exporter by 432 billion lbs million lbs in 2011 U.S. beef exports U.S. beef imports

15 Beef Exports10 Percent of Production in 2011and 2012 billion lbs percent Production Exports Exports as percent of production

16 U.S. Beef Exports Seeing Stars 3.0 billion lbs +14% -4% Vietnam 2.5 Hong Kong 2.0 Taiwan South Korea 1.5 Japan Other countries 1.0 Canada 0.5 Mexico 0.0

17 U.S. Cattle Imports Decrease as North American Inventories Decline million hd % -5% Mexico Canada Total cattle imports

18 Dairy Marginal contraction in herd size in 2012 Milk production increases stem from higher production per cow Strong milk and product exports support prices Higher feed costs and lower milk prices squeeze milk-feed price ratio in 2012

19 Dairy Cow Inventory To Decline Fractionally to 9.18 million in 2012 million hd * 2012* Q1 Q2 Q3 Q4 Annual

20 Output Per Cow Increases Quarterly; 1.7 percent in 2012 thousand lbs * 2012* Q1 Q2 Q3 Q4

21 Milk Production billion lbs in billion lbs , $ /cwt $/cwt % +1.5% Total production All milk price

22 All Milk Price Will Peak in Q at $ /cwt $/cwt 25 All Milk Price

23 Strong Export Demand Boosts 2011 Product Prices 2.5 $/lb Cheddar cheese Butter Nonfat dry milk Whey

24 Milk Equivalent Exports 8.8 Billion Lbs in 2011, To Remain Strong into 2012 billion lbs 10 Milk Equivalent Exports, Fat Basis Q1 Q2 Q3 Q4 Annual * 2012*

25 Milk-Feed Price Ratio Below 2 in Q ratio Milk-Feed Price Ratio

26 Hogs/Pork Modest increases in production in 2011/12 Record hog prices, but feed costs cut into producer margins Productivity increases continue (weights, pigs per litter) Export demand to remain strong

27 Modest Increases in Pork Production billion lbs % + 1.1%

28 Prices Stable into 2012; Expected to Average $62-67/cwt $/cwt National Base: 51-52%, Live Equivalent Q1 Q2 Q3 Q4 Annual average * 2012*

29 Breeding Hog Inventory million hd Mar 1-Jun 1-Sep 1-Dec

30 Sow Farrowings Stabilize Late 2011; 0.3 percent Increase in 2012 million hd Sow farrowings

31 Over 10 Pigs Per Litter in Q2 hd * 2012* Q1 Q2 Q3 Q4 Annual average

32 Hog Weights Edge Higher in lbs Average Dressed Weight Q1 Q2 Q3 Q4 Annual average * 2012*

33 Like Beef, Pork Exports Booming billion lbs % +3% Russia South Korea Hong Kong Canada Other countries Mexico Japan

34 Broilers Industry contracting with lower broiler-breeder flock numbers Chick placements expected to trend downward Lower meat production into the second half of the year Heavier trending bird weights offsetting lower slaughter numbers Demand supporting higher prices for dark meat products

35 Industry Tightens Numbers in Broiler-Breeder Flock million Number of Birds in Broiler-Breeder Flock Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec NASS

36 Chick Placements to Turn Down into Second-Half 2011 million 820 Broiler Chick Placements for Growout Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec NASS

37 billion lbs Broiler Production Increases; Prices Steady to Higher cents/lb % +1.1% Broiler production 12-city whole bird price

38 Heavier Bird Weights Boosting Production lbs Broiler Live Weight at Slaughter NASS

39 Wholesale Composite Prices Weighed Down by Lower Breast Meat Prices cents/lb Broiler Composite Wholesale Price 60 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec AMS/ERS

40 Demand Supporting Leg-Quarter Prices cents/lb 60 Leg-Quarter Prices, Northeast Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec AMS

41 Broiler Exports Taiwan 70-4% +3% 80 billion lbs Angola Cuba Canada Hong Kong Mexico Russia 20 Other countries 10 0

42 Additional Outlook Information Available at: World Agricultural Outlook Board (WAOB) World Agricultural Supply and Demand Estimates Economic Research Service (ERS) Livestock, Dairy, and Poultry Situation and Outlook Foreign Agricultural Service (FAS) Livestock and Poultry: World Markets and Trade