October 13, 2008


Mexican cattle numbers increases as US exports reduce


Mexican cattle inventories for 2009 are expected to increase 1 percent, a little more than a 0.3-percent increase for calendar year 2008 due to a 20-percent reduction in cattle exports to the US and the higher prices of red meat. 


Cattle slaughter figures for 2009 are forecast to almost increase at the same increased rate as seen in 2008 (2 percent) because of  the need for feedlot operators to reduce inventories due to increasing feed costs. 


Although 2008 imports of cattle are estimated to increase by 63,000 head, they are not expected to increase in 2009.


In 2009, beef production and consumption are also not expected to see significant growth, while imports will grow a modest 4.6 percent. 


The beef production forecast for 2008 is slightly higher than the previous year (2.3 percent), while total consumption grew slightly more (3 percent), helped by increasing in imports (7 percent). 


Beef production for 2009 is forecast to increase only marginally over 2008, reflecting dampened consumer demand resulting from higher prices.  This continues the trend from 2008, as beef production forecast in CY 2008 only increased about 2 percent compared to figures in 2007.


Reducing the demand for beef is not only due to higher input costs related to feed but also as a consequence of the price increases in other costs such as petroleum, although less than one-third of Mexico’s beef production comes from feedlot operations, which are most significantly affected by higher grain prices.


Despite a higher slaughter rate, total cattle inventories for 2009 are expected to increase over 2008 as feedlot placements could continue to decline, due to higher feed costs.  Thus more cattle are expected to be grazed in order to avoid the higher feedlot costs.

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