WASDE: USDA 2015 pork production forecasts remain unchanged

Pork production forecasts for 2015 and 2016 are unchanged, though forecasts for total meat production in 2015 and 2015 are lowered from last month.

Beef production for 2015 and 2016 is lowered due to a combination of slower marketing of fed cattle and reduced cow slaughter. Broiler production for 2015 is lowered from last month as growth in the number of eggs set and chicks placed has slowed. Weaker forecast broiler prices are expected to limit production growth as well. No change is made to 2016 production. Turkey production is raised for 2015 based on hatchery data. Egg production for 2015 is lowered based on second quarter production but no change is made to the forecasts for the remainder of 2015 and 2016.

The beef export forecasts for 2015 and 2016 are lowered from last month on the relative strength of the dollar and expectations of weak demand. Beef imports are raised on strength in demand for processing-grade beef.

Pork and broiler imports and exports are adjusted to reflect June trade data. The turkey export forecast is reduced for 2015 and 2016 as supplies remain tight. Cattle prices for 2015 and 2016 are reduced from last month on weaker demand. Hog prices are reduced for 2015 as supplies are large. Broiler prices are lowered for both 2015 and 2016 on competition from relatively lower red meat prices. Turkey prices for 2015 are raised from last month on tighter supplies. Egg prices for both 2015 and 2016 are raised from last month on tight supplies and prices to date.

The milk production forecast for 2015 is unchanged from last month, but weaker milk prices in late 2015 and 2016 result in lower production for 2016 than forecast last month. Exports are reduced as competition in world markets is expected to be robust in both 2015 and 2016 and relatively strong domestic demand will likely encourage increased imports. Stocks at the end of 2015 are forecast higher than last month as a result of increased imports and reduced exports. Skim stocks for the end of 2016 are also forecast higher than last month.

Larger domestic supplies as a result of increased imports and weaker exports are expected to pressure product prices in 2015. Forecast prices for butter, cheese, nonfat dry milk (NDM) and whey are lowered from last month. Price forecasts for 2016 for cheese, whey, and NDM are WASDE-544-5 reduced. However, domestic demand strength and expectations that milk will flow away from butter and NDM production in 2016 support an increase in the butter price forecast.

NDM prices are expected to be pressured by continued competition in international markets. Class III and Class IV prices are reduced from last month for both 2015 and 2016. The all milk price is forecast at $16.75 to $16.95 per cwt for 2015 and $16.40 to $17.40 per cwt for 2016.

Source: USDA, World Agricultrual Supply and Demand Estimates report, Aug. 12, 2015