USDA Lowers Meat Production and Raises Milk Numbers

January 29, 2014 07:40 AM
USDA Lowers Meat Production and Raises Milk Numbers

Total red meat production for 2013 and 2014 is down from December estimates. For 2013, beef production is up; however, pork and turkey production are down. Moving into 2014, this reduces the forecast as lower pork and turkey production offset increased beef production.

USDA’s Quarterly Hogs and Pigs report, released Dec. 27, indicated that pig numbers were fractionally below a year earlier, which will constrain supplies of slaughter hogs in early 2014.
While producers intend to farrow more sows in the first half of 2014, porcine epidemic diarrhea virus (PEDV) will likely keep hog supplies tight.

Beef production is forecast higher for 2014 on higher-than-expected placements in the later part of 2013, and expected availability of winter pasture support increased cattle marketings and slaughter during the year.

USDA forecast wholesale beef at $209.05 per hundredweight. "Tight supplies are the underlying principal factor," says Ron Plain, a University of Missouri ag economist.

The milk production estimate for 2013 was lowered, but the forecast for 2014 is up as improving returns are expected to support a more rapid increase in output per cow.

Fat basis imports are down for 2013 and 2014 on lower than expected butterfat imports. For skim-solids basis, imports are down slightly for 2013 but held for 2014.

Fat basis exports are up for 2013 and 2014 on relatively strong demand for cheese and other products. Skim-solids exports are down slightly for 2013 as November’s non-fat dry milk (NDM) exports lagged. However, skim-solids exports are forecast to strengthen in 2014.

While down slightly, 2013 exports were very strong. Jim Dickrell, editor of Dairy Today, cautions farmers moving into 2014. "It will be hard to continue these numbers," he says. "Part of the reason why exports were up this past year was because of production challenges in New Zealand; they will rebound and could add 4% to their production totals."

For 2014, cheese, butter and NDM prices are up, as demand is forecast to increase. The Class III price is up due to higher cheese prices, and Class IV price forecast reflects higher butter and NDM prices. The All-Milk price is forecast at $20.60 to $21.40 per hundredweight. —Staff Report

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