November 13, 2007

Lower projections for US cattle, hog prices

The US Department of Agriculture (USDA), in its monthly World Supply and Demand report released Friday (November 9) lowered its forecasts for cattle and hog prices, predicting increased cattle slaughter, decreased beef exports and strong hog slaughter through the end of the year.

The USDA sees average national choice steer (1100 to 1300 lbs) prices at US$91.61 per hundredweight in 2007, down from its October forecast of US$92.11. Its 2008 average price forecast dropped to a range of US$87 to US$94 per hundredweight from its October forecast of US$88 to US$95.

For live hogs (barrows and gilts 51 percent to 52 percent lean), the USDA projects an average 2007 price of US$46.98 per hundredweight, down from October's forecast of US$47.73. For 2008, it dropped its forecast to US$44 to US$47 per hundredweight from US$44 to US$48 predicted in October.

Higher total meat supplies have pressured prices, according to the report.

USDA reduced its US beef export forecasts due to the suspension of exports to South Korea pending successful negotiation of new import protocols. It dropped its 2008 total US beef export forecast to 1.710 billion pounds from its October forecast of 1.875 billion.

However, pork forecasts were raised USDA as lower prices and a weaker dollar are expected to support increased sales. Pork exports are seen to reach 3.180 billion pounds from 3.085 billion in 2008.