20150217-USDA-USDA_Livestock,_Dairy,_and_Poultry_Outlook__February_17,2015_22页_406kb

Summary of Livestock, Dairy, and Poultry Outlook (LDP-M-248, Feb. 17, 2015)

Core Content

This report provides an overview of the U.S. livestock, dairy, and poultry industry trends and outlook for 2015, highlighting key factors influencing production, prices, and trade.

Main Points

Cattle and Beef

• Cattle Inventories: USDA NASS reported an increase in total cattle and calf inventories for January 1, 2015, with a 1% rise from 2014. Beef cow numbers increased by 2%, and heifers for replacement increased by 4%.
• Herd Expansion: The expansion is faster than anticipated, driven by increased numbers of cattle on small grains pastures (1.93 million head), which is unusual given the ongoing drought in the Southern Plains.
• Cattle Prices: Despite the expansion, cattle prices are expected to face downward pressure in the first half of 2015 due to higher supply and lower demand.
• Cattle Trade: Cattle imports in 2014 increased by 16% to 2.358 million head, mainly from Canada and Mexico. Imports are forecast to decline slightly in 2015 due to tight U.S. inventories.
• Beef Production and Trade: Beef production in December 2014 decreased by 2% compared to the previous year, but retail prices rose to $6.00 per pound. Beef imports increased by 31% in 2014, primarily from Australia, New Zealand, and Mexico. Exports fell slightly in 2014 due to a strong dollar and reduced domestic supplies. 2015 exports are expected to decline further to 2.450 billion pounds.

Pork and Hogs

• Pork Production: Pork production in the first quarter of 2015 is forecast at 6.13 billion pounds, 6% above first-quarter 2014. The increase is partly due to higher hog numbers and reduced PEDv impact.
• Hog Prices: Hog prices are expected to average $54-$58 per cwt in 2015, a 26% drop from 2014, due to increased production of competing proteins (broiler and poultry) and slowing pork exports.
• Pork Exports: U.S. pork exports in 2014 totaled 4.858 billion pounds, a 2.7% decrease from 2013. Exports to Mexico increased by 11%, while exports to Japan and China-H.K. declined. The strong U.S. dollar is expected to continue to hinder export competitiveness in 2015.

Poultry

• Broiler Production: Broiler meat production in December 2014 increased by 8.2% to 3.4 billion pounds, driven by higher chick placements and bird weights. Total 2014 production reached 38.5 billion pounds, 1.9% above 2013.
• Turkey Production: Turkey meat production in 2015 is forecast at 6.1 billion pounds, a 5.6% increase from 2014. This is due to higher slaughter numbers and stable live weights. Turkey meat production in the fourth quarter of 2014 rose by 7% to 1.5 billion pounds.
• Egg Production: Table egg production is expected to increase by 2% in 2015 to 7.3 billion dozen, driven by lower feed and energy costs, and increased hen numbers and egg production rates. Hatching egg production is forecast at 1.1 billion dozen, up 4% from 2014.
• Poultry Trade: Broiler shipments in December 2014 decreased by 1.6% to 562.4 million pounds. Turkey exports rose by 32% to 71.6 million pounds in December, mainly due to increased shipments to Mexico. Egg exports in 2014 reached 395 million dozen, up 6%, with expectations of further growth in 2015.

Dairy

• Milk Production: 2015 milk production is forecast at 211.5 billion pounds, a 2.7% increase from 2014. The Class IV milk price is forecast to be $15.10-$15.90 per cwt, down from previous estimates, while Class III is forecast to be $16.30-$17.00 per cwt.
• All-Milk Price: The all-milk price is expected to be $17.40-$18.10 per cwt, down from $17.75-$18.55 per cwt.
• Price Trends: Prices for many broiler products have declined, but some, like boneless/skinless breast meat, remain higher than in 2014. Prices for turkey parts are trending downward, with the exception of V-type wings, which are higher.

Key Information

• Cattle Inventories: The U.S. cattle and calf inventory is still historically low, but the expansion is faster than expected.
• Hog Prices: Hog prices are expected to fall due to increased production and slowing exports.
• Broiler Production: Broiler meat production is expected to increase in 2015, with continued moderate feed prices supporting growth.
• Turkey Production: Turkey meat production is forecast to rise, driven by higher slaughter numbers and stable live weights.
• Egg Production: Table egg production is expected to increase in 2015, with a notable price spread between California and other regions.
• Dairy Prices: Milk prices are expected to decrease slightly in 2015, influenced by lower NDM prices and higher whey prices.
• Trade Trends: The U.S. dollar's strength is a key factor affecting export competitiveness in all sectors. Trade with Russia declined in 2014 due to import bans, but other markets absorbed some of the lost volume.

Outlook

• Cattle: Prices are expected to face downward pressure in the first half of 2015.
• Pork: Hog prices will likely continue to decline due to increased production and export challenges.
• Poultry: Broiler and turkey production is expected to grow in 2015, with potential downward pressure on prices.
• Dairy: Milk prices are forecast to remain stable, with some categories showing declines.