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World Agricultural Supply and Demand Estimates

by 5m Editor
11 December 2006, at 6:26pm

US - This weekly report, approved by the World Agricultural Outlook Board, offers the latest news on livestock, dairy and poultry estimates as well as grains.

Compared with last month, total forecasts for U.S. meat production is raised for 2006 but lowered for 2007. Beef production for 2006 is raised because cow slaughter during the fourth quarter is expected to remain high as cattle producers continue to respond to tight forage supplies.

Small increases are made to broiler meat production but estimates for pork and turkey are unchanged from last month. The 2007 broiler meat forecasts are reduced from last month as eggs set and chick placements point to slower production growth.

Beef, pork, and turkey production forecasts are unchanged. Forecast 2006 prices for hogs, broilers, and turkeys are raised as production growth remains moderate, but cattle prices are slightly lower in the fourth quarter as packers continue to struggle with weak margins.

Forecasts of cattle and hog prices are unchanged for 2007, but poultry prices are raised as production growth is forecast to lag 2006 levels. Egg prices are raised as production growth is modest and demand remains firm.

Red meat and poultry trade forecasts for 2006 and 2007 are lowered from last month. Pork forecasts are little changed but imports of beef are reduced as recent imports from Australia are below expectations.

Beef export forecasts for 2006 and 2007 are lowered as trade to a number of markets has slowed and uncertainties limit exports to South Korea. Broiler export forecasts for 2006 and 2007 are reduced, reflecting weaker-than-expected third quarter sales and apparent softness in export markets.

U.S. milk production forecasts for 2006 and 2007 are unchanged from last month. Despite gains in milk prices, weaker milk-feed price ratios will likely slow growth in milk production into 2007. However, dairy markets are relatively tight as demand for many dairy products is reducing skim-basis stocks and supporting higher prices. Supplies of butter are expected to remain ample, pressuring 2006 butter prices, but price forecasts for cheese, nonfat dry milk, and whey are raised from last month. As milk production growth slows in 2007, tight world supplies of dairy products are likely to support higher product prices.

Thus, price forecasts for products, except butter, are raised from last month, resulting in higher Class price forecasts. The butter price forecast is lowered fractionally from last month. The range of the all milk price for 2006 is forecast at $12.85 to $12.95, and the price forecast for 2007 is $13.70 to $14.50.

Further Information

To read the full report, click here (PDF)

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5m Editor