Nov. 19, 2012- USDA’s Livestock, Dairy and Poultry Outlook released
last week indicated that beef packers reduced slaughter in 2012, but beef
production is down by less than slaughter would indicate.
considerable discussion about shortages of cattle and calves looming for the
remainder of 2012, 2013, and beyond, the total number of steers and heifers on
feed in feedlots of 1,000 head or more on October 1, 2012 was 2.7 percent below
October 2011 (second highest in the last 10 years), but 1.8 percent above
October 2010, according to USDA. It was the third highest October 1 inventory
of steers and heifers on feed in 1000-plus-head lots (behind 2006 and 2011) and
the second highest steer inventory (behind 2006) in the last 10 years.
packers reduced kills for several weeks in an attempt to pressure fed cattle
prices lower and improve their currently negative profit margins. Weekly
federally inspected cattle slaughter through November was 4 percent below both
2011 and 2010 and 2 percent below 2009. However, heavier dressed weights
resulted in beef production through November that was not quite 2 percent below
same-period in 2011 and 2010.
feeders’ and beef packers’ poor margins will likely continue until cattle and
beef prices reach levels that generate positive margins for both sectors, or
until grain prices decline to levels that make cattle feeding profitable enough
for packers to achieve positive margins,” stated the report.
of the World Agricultural Outlook Board Gerry Bange noted the price ceiling may
be broken next year. Currently, retail Choice beef prices continue to struggle
to move above $5 per pound.
for either cattle feeders or beef packers looks unlikely over the coming year,
except at the expense of one or the other, until higher cattle prices are
matched by higher retail beef prices, feeder cattle prices decline, and/or
lower corn prices result in feed costs low enough to allow cattle feeding
profits,” according to the report.
the dairy industry, the report noted that feed price forecasts continue to
decline, but no production rebound in expected in 2013.
moderate contraction in herd size is expected to continue in 2013,” stated the
demand for powders remains strong, but export demand for butterfat is weaker.
Prices for Class III, Class IV, and all milk will trail 2011 prices both this
year and next.
production forecasts were lowered slightly to reflect lighter expected hog
weights. Nonetheless, fourth-quarter 2012 pork production is forecast 1 percent
above the same period last year. Pork production in 2013 is expected to decline
by 1.4 percent. Fourth-quarter 2012 hog prices are expected to average about 10
percent below a year ago. In 2013, hog prices are expected to rebound,
increasing about 6 percent above average hog prices in 2012.
meat production in fourth-quarter 2012 is forecast at 9.05 billion pounds,
about 2 percent higher than a year earlier. Broiler meat production in 2013 is
forecast at 36.4 billion pounds, a decrease of 1 percent from 2012. Broiler
integrators are not expected to have any incentive to expand production due to
the combination of continued high prices for corn and soybean meal and expected
relatively modest growth in broiler prices.
meat production in fourth-quarter 2012 is forecast at 1.55 billion pounds,
which again would be almost a 4-percent increase from the same period a year
earlier. At the end of September, stocks of whole turkeys were estimated at 305
million pounds, up 9 percent from a year earlier. Higher whole bird stocks have
placed downward price pressure on their wholesale prices. Table egg production
in third-quarter 2012 was 1.67 billion dozen, up 1 percent from the same period
more details on this report, go here: http://www.ers.usda.gov/media/949018/ldpm221.pdf
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