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WASDE: Forecast For Total U.S. Meat Production Lowered From Last Month
LIVESTOCK, POULTRY, AND DAIRY: The 2018 forecast for total meat production is lowered from last month, but production forecasts are unchanged for 2019. Beef production for 2018 is lowered primarily as lighter carcass weights more than offset higher second-quarter steer and heifer and cow slaughter. Pork production for 2018 is lowered on the current pace of secondquarter slaughter and lower-expected commercial slaughter in the third quarter. Slightly heavier expected hog carcass weights in the second and third quarters partially offset declines in slaughter. USDA’s Quarterly Hogs and Pigs report will be released June 28th and will provide an indication of producer farrowing intentions for the remainder of 2018. Broiler production for 2018 is raised on the pace of second-quarter production data and stronger growth in production during the second half of the year. Turkey production in the second quarter of 2018 is raised on the current pace of slaughter; no changes are made to outlying quarters. Egg production for 2018 is raised on recent hatchery data. 
 
The 2018 beef import forecast is raised on increased shipments from Oceania, while the beef export forecast is raised largely on strong Asian demand reflected in recent trade data. The 2018 pork export forecast is raised on continued strong shipments to a number of key markets and expectations of continued pork exports to Mexico. Pork exports for 2019 are raised on expected strong demand to a number of key trading partners. Second-half 2018 turkey export forecasts are raised as U.S. prices remain attractive. The 2018 broiler trade forecast is unchanged from the previous month. No changes are made to 2019 beef and poultry trade forecasts.
 
Cattle prices for 2018 are lowered slightly on second-quarter price data; no changes are made to outlying quarters. Hog prices are raised for the second quarter of 2018 on current price strength, but no changes are made to the outlying quarters. Second-quarter broiler prices are lowered for 2018; no changes are made to outlying quarters. Turkey prices are increased fractionally for 2018, reflecting a higher second-quarter forecast. Egg prices for 2018 are lowered on recent price data. For 2019, hog prices are lowered on weaker expected demand, but no changes are made to cattle, poultry, and egg price forecasts for 2019. The milk production forecast for 2018 is reduced from last month on slightly lower cow numbers and slower expected growth in milk per cow. No change is made to the annual cow herd for 2019, but the milk production forecast for 2019 is lowered from last month on continued slow growth in milk per cow.
 
For 2018, fat basis exports are raised from the previous month as second-quarter exports are strong and continued strength in sales of a number of fat-containing products will largely mitigate the impacts of Mexico’s tariffs on U.S. cheese. For 2019, the fat basis export forecast is lowered. Skim-solids basis export forecasts for 2018 and 2019 are raised from the previous month on robust demand for non-fat dry milk and lactose thus far in 2018, and this strength is expected to carry into 2019. Fat basis imports for 2018 and 2019 are raised on higher imports of butterfat products, while skim-solids basis import forecasts for 2018 and 2019 are reduced
on lower imports of milk proteins and a number of other dairy products.
 
The 2018 cheese price is unchanged at the midpoint of the range, but is raised for 2019. The 2018 butter price forecast is raised, but is reduced slightly for 2019. Nonfat dry milk (NDM) and whey price forecasts are raised for both 2018 and 2019 on strong demand and a reduced production forecast. For 2018, the Class III price is raised on the stronger whey price. The Class IV price forecasts reflects higher butter and NDM prices. For 2019, both Class III and Class IV prices are raised. The all milk price is forecast higher at $16.60 to $17.00 per cwt for 2018 and is increased to $16.70 to $17.70 per cwt for 2019.