Livestock, dairy, and poultry outlook: Rain and disease reduce red meat production outlook

Beef/Cattle: Recent rains have improved pasture conditions in many parts of the United States, prompting demand for lighter weight feeder cattle and reducing cow slaughter. Cattle and beef prices have continued to set successive record highs due to foreign demand and low cattle inventories.

Beef/Cattle Trade: U.S. cattle imports through May 2014 were 7 percent higher than a year earlier and are forecast to total 2.075 million head for the year. The forecast for U.S. beef imports was raised to 2.521 billion pounds in 2014 and 2.560 billion pounds in 2015 as lower U.S. production will increase demand for imported processing beef. U.S. beef exports were up 6 percent through May but are forecast to decline 3 percent in 2014 due to higher U.S. beef prices.

Pork/Hogs: USDA adjusted 2014 and 2015 pork production lower, based on losses from Porcine Epidemic Diarrhea (PEDv) reported in the Quarterly Hogs and Pigs. For 2014, hog prices are expected to average almost 25 percent above prices last year. Pork exports in May were slightly ahead of a year ago. Russia bought 20.7 million pounds of ractopamine-free U.S. pork in May.

Poultry: The forecast for broiler meat production in the second half of 2014 is 19.4 billion pounds, less than 1 percent higher than the previous year as the weekly number of chicks being placed for growout continues to average slightly lower than the previous year. The small growth in broiler production is expected to place upward pressure on prices and cause declines in cold storage holdings. Egg prices averaged $1.35 per dozen in second-quarter 2014, 23 percent above the previous year. Even with higher production, egg prices have benefited from strong prices for almost all meat products.

Poultry Trade: Turkey and egg and egg product shipments in May were down from a year ago, while Broiler exports were up. Broiler shipments totaled 636.5 million pounds in May 2014, an increase of 2.1 percent from a year earlier. Egg shipments decreased 17.5 percent from a year ago, totaling 31.3 million dozen, while turkey exports totaled 60.3 million pounds in May 2014, a 3.2-percent decrease from the previous May.

Sheep/Lamb: Second-quarter prices averaged $148.99 per cwt, declining nearly $20 from the first-quarter levels. Thin markets have resulted in large swings in monthly Choice slaughter lamb prices at San Angelo. Prices are expected to stabilize for the rest of the year as lower demand is expected to become more in line with the tighter supplies of slaughter animals.

Dairy: Milk production is reduced fractionally from June based on lower expected yield per cow. Slightly lower production combined with firm domestic commercial use and exports act to keep milk and dairy product prices high this year. Cow numbers are forecast to rise 2015, based on improved producer returns, leading to higher production. Higher milk production next year will likely lead to lower milk and dairy product prices in 2015.