20171218-USDA-USDA_Livestock,_Dairy,_and_Poultry_Outlook_2017.12.18_23页_1mb

Summary of Livestock, Dairy, and Poultry Outlook (Dec. 18, 2017)

Core Content

This report provides the U.S. Department of Agriculture's (USDA) outlook for the first half of 2018 and the remainder of 2017 for key livestock, dairy, and poultry sectors. It includes production forecasts, price trends, and export/import data, with a focus on the impact of supply and demand dynamics, market conditions, and international trade developments.

Main Points and Key Information

Red Meat, Poultry, Eggs, and Milk

• Production Increases: Most sectors, including beef, pork, poultry, and milk, are expected to see year-over-year production increases in the first half of 2018.
• Price Trends: Prices are generally lower than in the first half of 2017, except for eggs, which are projected to rise sharply (+17.7%).
• Cattle and Beef:
  • Cattle on feed inventories remain higher than the previous year, with placements reflecting a larger cattle inventory.
  • Beef production in the first half of 2018 is expected to be seasonally higher (+5.1%) due to higher placements in the second half of 2017.
  • First-half 2018 cattle prices are expected to be 7.3% below 2017 levels.
  • Beef exports through October 2017 increased by 14.3% year-over-year, with Japan contributing over half of the growth.
  • U.S. beef exports to Japan continued to grow despite the safeguard tariff, with a higher proportion of frozen beef being exported.

Dairy

• Production and Prices:
  • Milk production in the first half of 2018 is forecast to increase by 1.6%.
  • Milk prices are expected to decline, with the all-milk price forecast for 2018 at $16.65-$17.45 per cwt.
  • Fourth-quarter 2017 all-milk price is forecast at $17.75-$17.95 per cwt, down 15 cents from the previous month's forecast.
• Stocks and Demand:
  • Milk cow herds are expected to expand slightly, driven by low feed prices.
  • Domestic use on a milk-fat basis for 2017 is forecast at 215.9 billion pounds, 0.8 billion less than last month.
  • On a skim-solids basis, commercial use is forecast at 183.2 billion pounds, 1.9 billion less than last month.
  • Imports of whole milk powder have increased significantly, contributing to higher stocks.

Pork and Hogs

• Production and Prices:
  • Fourth-quarter 2017 pork production is expected to reach a record high of 6.8 billion pounds, 2% higher than a year ago.
  • Pork prices are forecast to average $44-$45 per cwt, over 20% higher than a year ago.
• Export Trends:
  • U.S. pork exports in October 2017 increased by 9.5% year-over-year, with strong performance in Mexico, Asia, and Colombia.
  • Fourth-quarter pork exports are on track for a record high of 1.5 billion pounds.
  • Packer margins rebounded in November due to strong demand and lower-than-expected slaughter volumes.

Poultry

• Production and Prices:
  • Broiler production is expected to increase slightly, with prices forecast to decline by 6.8% in the first half of 2018.
  • Turkey production is projected to rise by 0.24%, driven by modest recovery in demand, but prices are expected to fall by 9.8%.
  • Turkey prices are forecast to average $0.93-$1.00 per pound for 2018, slightly higher than 2017.

Cattle Exports

• Cattle exports in October 2017 were five times higher than the previous year, reaching 34,359 head.
• The 2017 forecast for cattle exports has been revised upward to 165,000 head, with an additional 25,000 head expected for 2018.

Feed Prices

• Feed prices for 2017/18 are unchanged from the previous month's forecast, with corn at $2.85-$3.55 per pound and soybean meal at $295-$335 per short ton.

Tables and Reports

• Red Meat and Poultry Dairy Forecast: Released on December 28, 2017.
• Next Outlook Report: Scheduled for January 18, 2018.
• USDA Reports:
  • Quarterly Hogs and Pigs report will be released on December 22, 2017.
  • WASDE (World Agricultural Supply and Demand Estimates) and other reports are available through the USDA's website.

Contacts and Links

• Mildred Haley: mhaley@ers.usda.gov
• Keithly Jones: KJones@ers.usda.gov
• Lekhnath Chalise: Lekhnath.Chalise@ers.usda.gov
• Jerry Cessna: jgcessna@ers.usda.gov
• Jonathan Law: jonathan.law@ers.usda.gov
• Additional Information: Feed Outlook

Key Trends and Outlooks

• Supply and Demand Dynamics: Supply increases are expected across most sectors, but demand recovery is slower, leading to lower prices.
• Market Conditions: Prices are under pressure due to high stocks, lower demand, and seasonal factors.
• International Trade: Strong export performance to key markets like Japan, Mexico, and Asia is expected to continue, although some markets show declining trends.
• Cattle and Hog Slaughter: Slaughter volumes are expected to be relatively stable, but with some seasonal variations affecting prices and margins.

This report underscores the complex interplay between production, prices, and international trade in the U.S. livestock, dairy, and poultry sectors, highlighting both opportunities and challenges for the industry in the coming months.