November 12, 2008

              

 

USDA lowered its total U.S. meat production forecasts for 2008 and 2009, mainly to reflect lower pork and broiler production for 2008 and lower forecast pork production for 2009, according to its World Agriculture Supply and Demand Estimates report.

 

U.S. beef production for 2008 was reduced to 26.801 billion pounds from 26.805 billion pounds a month ago, based on the third-quarter production estimate.

 

Softer international demand and a stronger U.S. dollar are expected to dampen beef exports. USDA now forecasts 1.841 billion pounds of beef to be exported in 2008 versus 1.876 billion pounds predicted in October. In 2009, beef exports are now forecast at 1.92 billion pounds, down from 2.06 billion pounds expected last month. USDA also lowered its U.S. beef import forecasts for both 2008 and 2009.

 

USDA lowered its average Choice steer price (Nebraska, Direct, 1100-1300 pounds) for 2008 to US$93.22 per hundredweight from US$93.97 projected in October. For 2009, USDA lowered its average price range forecast to US$93 to US$100 from US$94 to US$102 last month.

 

 

It also revised the U.S. pork production for 2008. Pork production was lowered to 23.471 billion pounds from 23.55 billion pounds on a slower-than-expected pace of hog slaughter this quarter. Pork production forecasts for 2009 were dcreased to 23.094 from 23.164 last month as hog slaughter is expected to be lower due to smaller imports of hogs from Canada.

 

A weaker international demand and a stronger U.S. dollar are also expected to dampen pork exports. USDA lowered its 2008 pork export forecast to 5.068 billion pounds from 5.318 last month and dropped its 2009 forecast to 4.5 billion pounds from 5.1 billion pounds expected in October.

 

USDA dropped its average barrows and gilts (live equivalent 51-52 percent lean) price estimate for 2008 to US$47.86 per hundredweight from US$49.11 last month. For 2009, it dropped its average price forecast to a range of US$48 to US$52 per hundredweight from US$50 to US$55 last month, based on expected weaker exports.

 

Meanwhile, the broiler production forecast for 2008 has fallen to 36.745 billion pounds from 36.767 last month as a higher third-quarter estimate was more than offset by expectations of lower production in the fourth quarter. Hatchery data reflect declining eggs set, and bird weights have recently started to decline.

 

USDA raised its broiler exports estimate for 2008 to 6.719 billion pounds from 6.674 billion pounds as stronger-than-expected shipments in the third quarter more than offset weaker sales in the fourth quarter.

 

Turkey production for 2008 was raised to 6.185 billion pounds from 6.174 billion pounds on higher projected fourth-quarter production. Turkey exports were raised for 2008, but reduced for 2009 due to weakening demand and a stronger U.S. dollar.

 

Broiler price forecasts remain unchanged, while turkey price forecasts for 2008 and 2009 were lowered slightly due to higher domestic supplies.