- Cow slaughter continues at high rates, given the cow inventory base, which along with a high ratio of heifer-to-steer slaughter implies continued liquidation.
- An expected rise in domestic use, along with good export prospects and only a moderate rise in milk production, are expected to keep milk prices in 2011 very near 2010 levels. However, higher feed prices will likely squeeze producer profits in the upcoming year.
Beef/Cattle: Cow slaughter continues at high rates, given the cow inventory base, which along with a high ratio of heifer-to-steer slaughter implies continued liquidation. Feeder cattle continue to be placed in feedlots in year-over-year larger numbers, despite lower supplies of feeder cattle outside feedlots.
Beef/Cattle Trade: U.S. beef exports for 2010 are forecast at 2.3 billion pounds, just under the forecast for beef imports of 2.36 billion pounds. The United States should be a net beef exporter in the fourth quarter of this year, exporting and importing 650 and 500 million pounds, respectively. Year-over-year cattle imports remain strong, 16 percent higher than 2009, as large numbers of Mexican cattle crossed the border weekly in November and early December.
Pork/Hogs: USDA lowered hog prices in response to some apparent softening of demand for pork. Despite the reductions, average fourth-quarter prices are likely to remain more than 20 percent above fourth-quarter hog prices in 2009. Commercial pork production next year is expected to be about 1 percent above 2010, with hog prices less than 1 percent lower than this year, averaging $53-$57 per hundredweight (cwt). October pork exports were 9.5 percent below a year ago, with shipments to all major export destinations lower, except to Mexico, China, and the Dominican Republic.
Poultry: Higher broiler chick placements have resulted in a increase in the fourth-quarter 2010 broiler meat production estimate to 9.3 billion pounds and a small increase to the first-quarter 2011 estimate. The higher production is expected to increase stocks. Turkey production rose in October as the number of birds slaughtered was higher. Cold storage holdings for whole turkeys continued to be below those of a year earlier, putting upward pressure on prices.
Poultry Trade: October broiler shipments totaled 670 million pounds, a 10-percent increase from a year ago, while turkey shipments rose slightly less than 1-percent to begin the fourth-quarter.
Sheep/Lamb: Global lamb demand remains strong amid a time of very tight global supplies. Tight global supplies, coupled with record-high prices, have spurred increased domestic slaughter. Prices for 2010 are forecast at record levels, and given the tight domestic and global supplies, prices are expected to remain high throughout 2011.
Dairy: An expected rise in domestic use, along with good export prospects and only a moderate rise in milk production, are expected to keep milk prices in 2011 very near 2010 levels. However, higher feed prices will likely squeeze producer profits in the upcoming year.