|From USDA World Agricultural Supply and Demand Estimates Report.|
The 2012 forecast of total red meat and poultry
production is lowered from last month as reduced broiler meat production is expected to more
than offset higher forecast beef, pork, and turkey production. Lower expected broiler weights
are underpinning the reduced forecast, with hatchery data continuing to point toward fewer
birds for slaughter during most of 2012. Beef production is raised from last month. Despite
expected tight fed cattle supplies, cow slaughter is expected to remain relatively strong during
the first quarter and carcass weights are forecast higher. Pork production is raised as firstquarter
slaughter and first-half carcass weights are expected to be higher than forecast last
month. Egg production is lowered slightly for 2012. Estimates of 2011 meat and egg
production are adjusted to reflect December data.
The beef export forecast for 2012 is reduced slightly but poultry exports are raised. The pork
export forecast is unchanged from last month. Import forecasts are unchanged from January.
Beef and pork trade estimates for 2011 are unchanged but poultry exports are raised due to
stronger-than-expected shipments in November.
Cattle prices for 2012 are raised from last month, reflecting tight supplies of fed cattle. The
hog price forecast is unchanged from last month. Broiler prices are raised, reflecting lower
production, and turkey prices are raised on current price strength. The egg price range is
The milk production forecast for 2012 is raised. Milk cow numbers are raised for much of the
year as USDA’s Cattle report indicated 1 percent more dairy cows on January 1, 2012.
However, producers are holding 1 percent fewer heifers for addition to the dairy herd, which is
expected to push cow numbers lower later in the year. Milk per cow forecasts are raised as
milk per cow in the last quarter of 2011 was higher than expected and mild weather in much of
the country is supporting increased early year yields. Milk production estimates for 2011 are
raised, reflecting end-of-year production data. Fat-basis trade estimates for 2011 are
increased due to both stronger-than-expected imports of butteroil and exports of cheese during
November. The skim-solids export estimate for 2011 is raised largely on relatively strong
November exports of whey and skim milk powders. This strength is expected to carry into this
year, thus the skim-solids export forecast for 2012 is raised as well.
With higher forecast 2012 production, cheese and butter prices are lowered. The nonfat dry
milk (NDM) price is lowered to reflect slightly weaker early year prices. With stronger forecast
demand for whey, the whey price forecast is raised. The lower cheese price is expected to
more than offset the higher whey price, resulting in a reduced forecast Class III price. Lower
butter and NDM prices result in a lower Class IV price. The all milk price for 2012 is lowered to
$18.00 to $18.70 per cwt.
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