The U.S. Department of Agriculture lowered its forecast for 2020 total red meat and poultry production in its latest “World Agricultural Supply & Demand Estimates” report. The forecast was lowered to 106.30 billion lb. due to reduced pork and broiler production, which USDA said more than offset higher beef and turkey production.
USDA raised the beef production estimate from the previous month's report to 27.05 million lb. based on higher second-half cattle slaughter, while the pork production forecast was reduced to 28.24 million lb. based on the current pace of slaughter and lighter carcass weights.
On the poultry side, the broiler production forecast was reduced to 44.55 million lb. on recent hatchery data, while turkey production was raised slightly to 5.71 million lb. USDA raised its 2020 egg production forecast to 9.25 billion doz. eggs due to increased lay rates.
For 2021, USDA reduced the total red meat and poultry production forecast to 107.35 billion lb. due to lower expected beef, pork and broiler production. Beef production was reduced from last month's estimate on lower expected steer and heifer slaughter and lighter carcass weights, while pork production was reduced on lighter expected carcass weights. The broiler production forecast was also reduced on slower expected growth as the industry adjusts to higher feed costs. The turkey production forecast was unchanged.
USDA left the 2020 and 2021 beef and pork export forecasts unchanged. Specific to pork, USDA said continued demand strength from China has been offsetting weaker demand in other key markets. The 2020 and 2021 broiler, turkey and egg export forecasts were unchanged from last month.
The cattle price forecast for 2020 was $107.30/cwt., unchanged from last month, while the 2021 cattle price forecast was raised to $112.00 on lower production. Hog price forecasts were raised for 2020 to $39.40/cwt. on recent price strength but were unchanged for 2021, at $44/cwt. The 2020 broiler, turkey and egg price forecasts were raised on recent price strength. For 2021, USDA raised broiler price forecasts on anticipated lower production, while no changes were made to the turkey and egg price forecasts.
The milk production forecast for 2020 was raised from last month to 222 million lb. on higher expected growth in milk per cow. For 2021, USDA raised the milk production forecast to 225.4 million lb. on stronger anticipated growth in milk per cow.
Cheese, butter and whey price forecasts were reduced from last month, but the forecast for nonfat dry milk was unchanged. The Class III price forecast was reduced based on expectations for lower cheese and whey prices, while the Class IV price forecast was reduced due to the lower butter price forecast. USDA lowered the all-milk price forecast to $17.75/cwt. For 2021, price forecasts for cheese, butter and whey were lowered, while the nonfat dry milk forecast was unchanged. The Class III price forecast was reduced on lower cheese and whey price forecasts. The Class IV price forecast was reduced on the lower butter price forecast. The all-milk price forecast was lowered to $17.00/cwt. for 2021.