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World Agricultural Supply and Demand Estimates - September 2010

13 September 2010

USDA Economic Research Service

The forecast for 2011 has been reduced as higher feed prices encourage cattle producers to keep cattle on forage longer and tempers pork, broiler, and turkey production gains, according to the USDA World Agricultural Supply and Demand Estimates.

Livestock, Dairy and Poultry

Total US meat production forecasts for 2010 and 2011 are reduced slightly from last month. The forecast for 2010 is reduced as lower pork and broiler production more than offset an increase in beef production. The 2011 forecast is reduced as higher feed prices encourage cattle producers to keep cattle on forage longer and tempers pork, broiler, and turkey production gains. USDA’s Quarterly Hogs and Pigs report will be released on 24 September and will provide an indication of sow farrowing intentions into early 2011. Egg production forecasts for 2010 are adjusted to reflect a revision in second-quarter production but the 2011 forecast is unchanged.

Beef imports are reduced for 2010 and 2011 as imports have been lower than expected. Export forecasts for beef are raised on continuing strong sales to a number of markets. Pork and poultry trade forecasts are unchanged from last month.

Livestock and poultry prices for 2010 are raised but forecasts for 2011 cattle and hog prices are unchanged. The broiler and turkey price forecasts for 2011 are raised slightly on expected tightness in supplies. Egg prices for 2010 are forecast higher due to the recent spike in third-quarter prices, but the forecast for 2011 is unchanged.

Forecast milk production for 2010 and 2011 is raised from last month. Producers continue to add cows to the herd and inventories are forecast to increase into mid-2011. The rate of growth in milk per cow is also increased from last month. Fat basis export forecasts for 2010 are raised on strong sales of butterfat and cheese, but 2011 exports are lowered. Skim-solids exports for 2010 and 2011 are forecast higher than last month. Imports are reduced from last month due to higher US production and strong demand in other importing countries. Ending stocks for 2011 are increased as US production is forecast higher.

Strong demand for cheese and tight supplies of butter support higher forecast prices for 2010 and 2011. Stronger demand is forecast to absorb most of the increased production although prices are expected to be tempered during the latter part of 2011. Price forecasts for nonfat dry milk (NDM) are raised for 2010, but the 2011 forecast is unchanged from last month as increased supplies limit price gains. The whey price forecast is unchanged. Both Class III and Class IV price forecasts for 2010 and 2011 are raised due to the higher product prices. The all milk price is forecast to average $16.25 to $16.45 per cwt for 2010 and $15.85 to $16.85 per cwt for 2011.

Further Reading

- You can view the full report by clicking here.

September 2010

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