LIVESTOCK, POULTRY, AND DAIRY: The 2012 forecast of total red meat and poultry production is lowered from last month as reduced broiler meat production is expected to more than offset higher forecast beef, pork, and turkey production. Lower expected broiler weights are underpinning the reduced forecast, with hatchery data continuing to point toward fewer birds for slaughter during most of 2012.
Beef production is raised from last month. Despite expected tight fed cattle supplies, cow slaughter is expected to remain relatively strong during the first quarter and carcass weights are forecast higher.
Pork production is raised as first-quarter slaughter and first-half carcass weights are expected to be higher than forecast last month.
Egg production is lowered slightly for 2012. Estimates of 2011 meat and egg production are adjusted to reflect December data.
The beef export forecast for 2012 is reduced slightly but poultry exports are raised. The pork export forecast is unchanged from last month. Import forecasts are unchanged from January. Beef and pork trade estimates for 2011 are unchanged but poultry exports are raised due to stronger-than-expected shipments in November.
Cattle prices for 2012 are raised from last month, reflecting tight supplies of fed cattle. The hog price forecast is unchanged from last month. Broiler prices are raised, reflecting lower production, and turkey prices are raised on current price strength. The egg price range is narrowed.
The milk production forecast for 2012 is raised. Milk cow numbers are raised for much of the year as USDA’s Cattle report indicated 1 percent more dairy cows on January 1, 2012. However, producers are holding 1 percent fewer heifers for addition to the dairy herd, which is expected to push cow numbers lower later in the year. Milk per cow forecasts are raised as milk per cow in the last quarter of 2011 was higher than expected and mild weather in much of the country is supporting increased early year yields. Milk production estimates for 2011 are raised, reflecting end-of-year production data. Fat-basis trade estimates for 2011 are increased due to both stronger-than-expected imports of butteroil and exports of cheese during November. The skim-solids export estimate for 2011 is raised largely on relatively strong November exports of whey and skim milk powders. This strength is expected to carry into this year, thus the skim-solids export forecast for 2012 is raised as well.
With higher forecast 2012 production, cheese and butter prices are lowered. The nonfat dry milk (NDM) price is lowered to reflect slightly weaker early year prices. With stronger forecast demand for whey, the whey price forecast is raised. The lower cheese price is expected to more than offset the higher whey price, resulting in a reduced forecast Class III price. Lower butter and NDM prices result in a lower Class IV price. The all milk price for 2012 is lowered to $18.00 to $18.70 per cwt.
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