Burgeoning supplies of meat and poultry next year could bring a price drop for beef cattle, hogs, broilers and turkeys. Gary Crawford has this report
This year US beef production will be at a record high, but if USDA forecasts turn out to be correct, that record won’t stand for long. Analyst are looking at increases in output next year for turkeys, broilers, pork and beef. USDA Outlook Board Chairman Seth Myers add up all of those increases “in total meat production we’re up three billion pounds year over year.” So, meat production next year could be another record, 100.4 billion pounds up 3% from this year.
And so, USDA’s chief economist, Rob Johansson says as a logical result of that…”we’re expecting beef, hog and broiler prices to come down in 2017.” The biggest mover with the most influence on all livestock prices, the beef side.
Outlook Board Chair Seth Myers says we could see a substantial hike in beef production in 2017, “on higher expected placements in late ’16 carrying into ’17, so those late placements in ’16 become production in ’17.” Yes, more cattle being placed in feedlots translating to beef production outpacing this year by over a billion pounds or 4.4% at 26.1 billion pounds. “So, we trimmed 2017 prices $10 to $106.” This year’s average steer price just under $120, lately though, much lower than that.
And for hog producers with all that beef out there…”it’s hard to gain any price strength”, Seth Myers says pork producerion this year is running higher than expected, at an average for this year could be around $45.65, and Myers says also, in USDA’s forecast…”We reduced the 2017 by a buck down to $40, and you’ve got falling prices despite trimming pork supplies a little bit from your prior expectations, they’re still growing year-over-year, but that extra beef and those lower beef prices are simply going to weigh on pork prices and other meat prices, as well.”