September 25, 2006

 

Improved weather conditions boost livestock and crop growth in the US

 

 

Improved moisture conditions in the US, especially the northern Great Plains and western Corn Belt during August have resulted in much-improved corn and soybean yields, the USDA wrote in a recent ERS report.

 

Recent rains in the Southern Plains have improved prospects for winter pastures, which could mean reduced beef cow slaughter. Cow slaughter would likely be reduced as much culling has already occurred, due to drought.

 

Improving grazing prospects, would provide increased competition for relatively low feeder cattle supplies.

 

Reduced cow slaughter should provide support for cow prices, and increased competition should boost feeder cattle prices.

 

Heat-induced tighter milk supplies have contributed to summer prices, which were higher than expected. However, continued rises in production of dairy products point to modest price increases in the coming months.

 

Broiler meat production continues to expand, but at a much slower pace than earlier in 2006, resulting in lower stocks and higher prices. The slowdown in broiler meat production growth is expected to continue through the fourth quarter of 2006.

 

US broiler and turkey exports were up in the month of July compared with a year ago. Broiler shipments totaled 441 million pounds, up 5 percent from July 2005 due to Russian demand.

 

The US broiler meat production estimate for third quarter 2006 is 9.0 billion pounds, up less than 1 percent from the previous year.

 

Almost all the production increase is expected to come from higher average weights at slaughter as numbers declined slightly

 

Broiler meat production in July was 2.85 billion pounds, up 1.5 percent from a year earlier.

 

As for crops, the US is expecting its second largest corn crop as moisture conditions improved during August.

 

Corn production is forecast at 11.1 billion bushels, up 1 percent from the August estimate.

 

However, production of the other feed grains (sorghum, barley, and oats) is expected to decline.

 

Total feed grain production this year is expected to be up marginally from last year.

 

Similarly the soybean crop is also expected to be the second largest on record. Yield prospects have increased across the Corn Belt and most of the northern and central Great Plains.

 

Consequently, soybean meal production is expected to be up 2.5 percent from last year and up 3 percent from 2004/05.

 

As for the dairy sector, much of the effect of July's exceptionally hot weather was felt in California and several other States. Nationally, the impact was limited.

 

Despite the heat, national milk production for July was at 1,686 pounds per cow, 3 pounds above a year earlier.

 

As a result, USDA is forecasting 2006 milk production at 182.0 billion pounds, 2.8 percent ahead of 2005 production.

 

In 2007, cow numbers would fall below year-earlier levels but milk per cow would  continue to rise, boosting production per animal to an average 20,285 pounds.