June 21, 2012

 

US May pork stocks slightly down, beef likely record high

 

 

As of May 31, the average for US pork stocks was down modestly against previous month but still the largest ever for May, while beef supplies are expected to be record high for the month, according to analysts' predictions.

 

The USDA will release its monthly cold storage report Friday (June 22) at 3:00 p.m. EDT (1900 GMT).

 

Total pork inventories as of the end of May are expected at 643.3 million pounds, compared with 659.5 million a month ago and 548.3 million a year ago, according to the average prediction of three analysts in a Dow Jones Newswires survey. Estimates ranged from 623.8 million to 676.1 million pounds. The current record for May pork stocks is 584.5 million pounds set in 2009.

 

If the average estimate is correct, frozen pork inventories at the end of last month were 21.4% above the five-year average. Pork production in May was likely the largest ever for that month and up 9.5% from a year ago, said Bob Brown, private analyst in Edmond, Okla. He predicts pork stocks at 623.8 million pounds.

 

Dan Vaught, president of Vaught Futures Insights, predicts total pork stocks at 630 million pounds, reflecting a 29.5 million pound decline from the previous month. He said a pull down in stocks is normal in May on widespread usage over the Memorial Day holiday weekend. Large pork production and heavier carcass weights probably mitigated the usual mid-spring decline, he said.

 

The largest estimate for end-May pork stocks came from Rich Nelson, director of research with Allendale Inc. He predicts a growth of nearly 17 million pounds from April to put his May 31 figure at nearly 676.1 million pounds.

 

Analysts on average predicted ham supplies in cold storage at 123.6 million pounds, up 11.0 million from the previous month. If correct, the increase was below the five-year average gain of 17.0 million.

 

Vaught predicts that ham sales to Mexico in May were generally strong, in line with shipments earlier in the spring that reduced US inventories. His end-May ham estimate was 120 million pounds. Brown estimates 127.2 million pounds of hams were in storage at the end of May, which would be the second highest ever behind 131.2 million in 2008.

 

In the beef sector, the analysts on average projected end-May stocks up slightly from April and 16.5% above a year ago. Vaught's estimate at 525 million pounds was the highest. He said high wholesale prices probably slowed sales domestically as well as the export markets. Nelson estimated beef stocks at 524.7 million pounds, which would represent an increase of about 7.1 million pounds from the previous month, above the five-year average growth of about one million pounds.

 

Brown predicts belly inventories at 70.5 million pounds, a decrease of 4.3 million pounds from the previous month, near the five-year average decline of 3.9 million pounds. End-May stocks are expected to be about 23.5% above year-ago and 8.5% above the five-year average.

 

Total chicken inventories are expected at 600.7 million pounds, down 1% from the previous month, 20.8% below a year ago and 13.2% below the five-year average. If the estimates are correct, chicken stocks would be the lowest for end-May since 1995, which was at 526.3 million pounds, Brown said.