June 24, 2006

 

USDA livestock: US beef slackens slightly; Russia factor weighs on pork, broiler exports

 

 

Trade ban uncertainties from the discovery of BSE in the United States and Canada remain the major sticking point for the North American region's beef forecasts, reports the US Department of Agriculture in its latest Livestock, Dairy and Poultry Outlook report released July 21, 2006.

 

The US considers Japan's suspension of its beef "temporary pending the resolution of importer concerns," said the report. It also added that no forecasts were given for US beef exports to South Korea as the US awaits the implementation of import regulations by that market.

 

While recent rains in the plains and south-east US have bolstered cattle markets and affected prices positively, pasture conditions remained well below last year's level, and below average on whole, said the report. Lower cold storage stocks of pork and poultry, however, are expected to have a positive influence on demand for beef.

 

The report's latest estimate for 2006 milk production was up slightly to 82.8 billion kilogrammes (182.1 billion pounds), as both cow numbers and output per cow were bumped up to 9.14 million head and 2336.4 kg respectively for Q2 this year. USDA projections for the rest of 2006 and 2007 forecasts remain unchanged.

 

An earlier report on hogs and pigs released end-June showed swine inventories largely unchanged from a year ago. According to that June report, the US hog industry is continuing to improve its efficiencies from the breeding herd, with pigs per litter for the March-May pig crop up 1 percent over the year-ago period.

 

According to the report, US pork exports in May were almost 11 percent above May 2005, with both Russia and Mexico the key drivers for May's strong export showing.

 

Japan, by far the world's largest importer of fresh and frozen pork products and the biggest importer of US pork, is expected to lower its pork imports by more than 10 percent this year, estimates the USDA, largely due to a flattening of pork demand which had ballooned after the bird flu and BSE crises in Asia and North America respectively in the past few years. 

 

On broiler production, the USDA report showed broiler meat production up 4.1 percent in the first quarter 2006. Second quarter estimates were at 4.1 billion kg, a 1.9-percent increase from last year. Prices of most broiler products are expected to increase gradually as broiler production slows in the latter half of 2006, compared with the first half.

 

Russia's new import permit regime weighed on May's US broiler exports, which fell by 9 percent from May 2005 on early-month trader concerns, the report noted.

 

 

For the full USDA report, click here