WASDE: Meat Production Up, Milk Production Unchanged
LIVESTOCK, POULTRY, AND DAIRY: The forecasts for total meat production in 2015 and 2016 are increased from last month. Beef production for 2015 is raised on larger forecast slaughter of fed cattle in the second half of 2015 and heavier carcass weights. The forecast for 2016 is raised as cattle slaughter and carcass weights in the first half are projected higher than last month. The pork production forecasts for both 2015 and 2016 are raised. The pace of hog slaughter in the remainder of 2015 is expected to be higher. USDA’s Quarterly Hogs and Pigs estimated less of a decline in sows farrowing during June-August than indicated in prior intentions and farrowing intentions into early 2016 support an increase in forecast pork production for 2016. Broiler production is raised for 2015 as a larger third quarter level more than offsets a reduction for the fourth quarter, but the forecast for 2016 is reduced as broiler producers have slowed the pace of egg sets. Turkey production for 2015 is lowered based on third-quarter production data; subsequent quarters through 2016 are unchanged. Egg production for 2015 is raised on higher third quarter hatching egg production. Production forecasts for 2016 are unchanged.
Beef imports are unchanged for 2015 and 2016. Beef exports for 2015 and 2016 are lowered as demand is projected to remain relatively weak. Pork export forecasts are unchanged, but a small increase is made to third-quarter 2015 imports based on recent trade data. Broiler exports are reduced from last month as slow global demand is expected to continue for in the remainder of the year and into 2016.
Cattle prices for 2015 and 2016 are reduced from last month on current large supplies of market-ready cattle, weaker demand and competition from relatively large supplies of competing meats. Hog prices are raised for both 2015 and 2016 as demand has firmed. Broiler prices are lowered for both 2015 and 2016 on relatively large broiler meat supplies. Turkey prices are raised for 2015 on current price strength, but the forecast for 2016 is unchanged from last month. Egg prices for 2015 are lowered reflecting recent price declines, but the forecast for 2016 is unchanged.
Milk production forecasts for 2015 and 2016 are unchanged from last month. Fat-basis imports are increased as domestic demand continues to support higher imports of cheese and butter. Exports are reduced for 2015 on weaker cheese sales, but are unchanged for 2016. Skim-solids imports are reduced for 2015 and 2016, while exports are reduced for 2015 and unchanged for 2016. Large world supplies of dairy products, a strong dollar, and generally weak global demand are expected to continue to pressure exports during 2015 and 2016.
Although butter prices have declined sharply from recent high levels, domestic demand for butter is expected to support relatively high butter prices during 2016. The butter price for 2015 is unchanged at the midpoint, and is raised for 2016. Cheese prices are raised for 2015 and 2016 on support from domestic demand. Nonfat dry milk (NDM) prices are forecast higher in 2015 and 2016 reflecting a rebound in both domestic and international prices. Whey prices are lowered for both 2015 and 2016 as supplies are large. Class III prices are raised for 2015, but lowered for 2016 as the decline in whey prices more than offsets higher cheese prices. Class IV prices are raised for both 2015 and 2016 due to higher butter and NDM prices. The all milk price is raised to $16.90 to $17.00 per cwt for 2015, but lowered to $16.05 to $16.95 per cwt for 2016.
