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  • U.S. imports of Red Meat, Eggs, and Dairy Account for a Modest Percentage of Domestic Use

    The figure below shows imports of red meat, eggs, and dairy products as a percentage of total domestic disappearance (i.e., “use”) for 2016 and 2017 based on USDA forecasts. The average percentage for 2011-2015 is included as a basis for comparing ratios for 2016 and 2017. With the exception of lamb—with imports of upwards of 55 percent of use—other red meat, eggs, and dairy imports comprise a relatively modest percentage of U.S. usage. Poultry imports are minimal, so are not included in this analysis. Also, the ratios for beef and pork depicted in the figure above do not account for live animal imports. In each case, live animal imports from NAFTA partner countries are expected to account for roughly 5 percent of cattle and hogs slaughtered in the United States this year. Most red meat imports come from Oceania and Canada. NAFTA partners Canada and Mexico account for almost half of U.S. egg imports. Most dairy products are imported from the European Union and New Zealand.

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    Beef Pork Lamb Eggs Dairy*

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    2016

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    Imports as a Percentage of Disappearance: Beef, Pork, Lamb, Eggs and Dairy, 2011-2015 and Projections for 2016, 2017

    *Dairy percentages are calculated on a milk-fat milk-equivalent basis. Source: WAOB, U.S. Department of Agriculture

    Livestock, Dairy, and Poultry Outlook Mildred Haley, Coordinator mhaley@ers.usda.gov

    Keithly Jones, Coordinator kjones@ers.usda.gov

    Economic Research Service

    Situation and Outlook

    LDP-M-269

    Nov. 16, 2016

    Contents Cattle/Beef Dairy Pork/Hogs Poultry Contacts and Links

    Tables Red Meat and Poultry Dairy Forecast

    Web Sites Animal Production and Marketing Issues Cattle Dairy Hogs Poultry and Eggs WASDE ----------------------------- Tables will be released on November 25, 2016

    The next Outlook Report release is December 15, 2016 ----------------------------- Approved by the World Agricultural Outlook Board.

    mailto:mhaley@ers.usda.gov mailto:kjones@ers.usda.gov http://www.ers.usda.gov/topics/animal-products/animal-production-marketing-issues.aspx http://www.ers.usda.gov/topics/animal-products/animal-production-marketing-issues.aspx http://www.ers.usda.gov/topics/animal-products/cattle-beef.aspx http://www.ers.usda.gov/topics/animal-products/dairy.aspx http://www.ers.usda.gov/topics/animal-products/hogs-pork.aspx http://www.ers.usda.gov/topics/animal-products/poultry-eggs.aspx http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1194

  • Cattle/Beef: Packers continue to enjoy attractive margins, and given the higher 2017 beef production forecast and the increased amount of beef currently held in cold storage, prices are likely to remain under pressure. Lower cattle prices have begun to spill over into the retail price market.

    Dairy: USDA National Agricultural Statistics Service revised the number of milk cows downward for July and August, and September cow numbers are slightly below the previous month. The forecast for milk cows has been lowered, resulting in production forecasts for 2016 and 2017 that are 0.2 and 0.3 billion pounds lower, respectively, than last month. Exports on a milk-fat milk-equivalent basis in 2016 and 2017 are expected slightly lower than last month. Cheese price forecasts are raised for the rest of 2016 and for 2017, and the all-milk price forecast is raised to $16.00-$16.10 per cwt in 2016 and $16.30-$17.20 in 2017.

    Pork/hogs: Pork production is likely to be especially strong as the industry moves through the fourth quarter of 2016. Prices will reflect very heavy slaughter numbers, particularly in November and December. Fourth-quarter prices are expected to average $34-$36 per cwt. Export shipments in the third quarter were solid at 5.3 percent greater volume than in the same period last year.

    Poultry: Price forecasts were lowered across broilers, turkeys, and eggs for the fourth quarter due to weaker-than- expected prices in recent weeks. Exports in September showed signs of a continued recovery across the three commodities. Forecast production was lowered for turkey for the fourth quarter, and broiler production was lowered for 2017.

    2 Livestock, Dairy, and Poultry Outlook/LDP-M-269/November 16, 2016

    Economic Research Service, USDA

  • Cattle / Beef

    Cattle Prices Declined in October

    October cattle prices were lower relative to September and last year. Weekly average fed cattle prices declined during the month, averaging about $100 per cwt compared to $131 in 2015. However, prices in early November have averaged above $100. Medium-frame feeder steers in Oklahoma City averaged $123.50 cwt in October, down 8 percent from September, and 35 percent from the same period last year. Cutter-cow prices have also declined, with prices falling to the low-$60’s per cwt in late October. Given the higher 2017 beef production forecast and the large amount of beef currently held in cold storage, prices are likely to remain under pressure. Beef production in 2017 is forecast to be just over 4 percent higher year over year compared to last month, when it was under 4 percent higher. Fed cattle prices for 2017 have likewise been reduced from last month and are forecast to average $102 to $110 per cwt.

    Lower cattle prices have begun to spill over into the retail price market. The retail Choice beef price in September, 2016 was $5.87 per pound, about 1 percent lower than August and 6 percent lower than 2015. Retail prices have been known to show a delayed response to changes in cattle and wholesale beef prices.

    Beef Imports Revised Downward

    Third-quarter 2016 beef imports were 751 million pounds, down 16 percent from the same period last year. Imports for the fourth quarter were revised downward 10 million pounds from last month’s forecast to 635 million pounds. Figure 1 shows monthly imports for 2015 and imports from January through September 2016. Each month’s imports for 2016 have been below those for 2015 as supplies from Australia have tightened with herd rebuilding and domestic cow slaughter has been higher.

    Third-quarter 2016 exports came in at 659 million pounds, up 22 percent from last year. However, September export data and reported October export sales were weaker than expected, and as a result, slight downward revisions of 10 million pounds in exports to 645 million pounds were made to fourth-quarter 2016. Figure 2 shows monthly exports for 2015 and January-September 2016. Exports are generally running above last year. Mexican exports this year have been stronger than last year. Although the depreciation of the peso continues to affect the competitiveness of U.S. beef despite declines in U.S. wholesale price declines, beef exports are still running near or above last year’s levels.

    3 Livestock, Dairy, and Poultry Outlook/LDP-M-269/November 16, 2016

    Economic Research Service, USDA

  • Authors: Keithly Jones, kjones@ers.usda.gov; William Hahn, whahn@ers.usda.gov.

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    U.S. beef imports, monthly, 2015 and 2016

    Source: U.S. Dept. of Agriculture, Economic Research Service.

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    U.S. beef exports, monthly, 2015 and 2016

    Source: U.S. Dept. of Agriculture, Economic Research Service.

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    4 Livestock, Dairy, and Poultry Outlook/LDP-M-269/November 16, 2016

    Economic Research Service, USDA

    mailto:kjones@ers.usda.gov mailto:whahn@ers.usda.gov

  • Dairy

    Recent Developments in Dairy Markets

    The U.S. Dept. of Agriculture (USDA) National Agricultural Statistics Service (NASS) reported that milk cow numbers fell in September to a total of 9.338 million head, a drop of 3,000 head from August. Notably, this drop is from a lower base than reported in the October Milk Production report, due to NASS downward revisions in milk cow numbers for July and August. Milk per cow fell seasonally in September from the previous month, but increased year-over-year to 1,817 pounds. Milk production in September totaled 17.0 billion pounds, an increase of 2.1 percent from September 2015.

    Dairy product exports fell about 0.1 billion pounds on a milk-fat milk-equivalent basis from August to September, while exports on a skim-solids milk-equivalent basis fell about 0.4 billion pounds. Dry whey exports and nonfat dry milk (NDM) exports fell about 12 million pounds and 6 million pounds, respectively, from last month. Imports fell about 0.1 billion pounds on both milk-fat and skim-solids milk-equivalent bases from August to September.

    Cheese prices have trended upward over the second half of October; prices of 40-pound blocks of cheddar cheese, as reported in the USDA National Dairy Products Sales Report (NDPSR), fell from $1.668 for the week ending October 1st to $1.576 mid-month, but rebounded to $1.603 for the week ending October 29th. Similarly, prices of 500-pound barrels of

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