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Summary of the Livestock, Dairy, and Poultry Outlook: November 2021

Core Content

This report provides an overview of the U.S. livestock, dairy, and poultry markets for the years 2021 and 2022, focusing on production, exports, imports, and pricing trends. It includes detailed forecasts and analysis of various animal products and their performance in the global market.

Key Trends and Forecasts

Beef

• Production:
  • 2021: Forecast at 27.885 billion pounds, up 53 million pounds from last month.
  • 2022: Forecast at 27.0 billion pounds, a slight increase from the previous month's forecast.
• Exports:
  • 2021: Forecast at 3.455 billion pounds, up 41 million pounds from last month.
  • 2022: Forecast at 3.270 billion pounds, unchanged from last month.
• Imports:
  • 2021: Forecast at 3.260 billion pounds, up 50 million pounds from last month.
  • 2022: Forecast at 3.240 billion pounds, reflecting a slight decline year-over-year.
• Export Shares:
  • Beef exports as a share of production are expected to fall slightly from 12.4% in 2021 to 12.1% in 2022.
• Carcass Weights:
  • Increased in September and October, contributing to higher production forecasts.
• Prices:
  • Fed steer prices for 2021 are forecast at $128.00 per cwt, up $1.00 from last month.
  • Feeder steer prices for 2021 are forecast at $145.55 per cwt, up from last month's forecast.
  • 2022 fed steer prices are forecast at $130.00 per cwt, up $1.25 from last month.
• Import Sources:
  • Canada and Brazil showed significant increases in import shares for the third quarter.
  • Australia and Uruguay saw declines, with Australia down 39% and Uruguay down 41% year-over-year.
  • China was the largest export destination in September, with a 313% increase in exports.

Dairy

• Production:
  • 2021: Forecast at 226.4 billion pounds, down 0.6 billion pounds from last month.
  • 2022: Forecast at 228.1 billion pounds, up 1.7 billion pounds from 2021.
• Exports:
  • 2021: Forecast at 11.9 billion pounds on a milk-fat basis and 51.4 billion pounds on a skim-solids basis.
  • 2022: Forecast at 11.4 billion pounds on a milk-fat basis and 51.8 billion pounds on a skim-solids basis.
• Imports:
  • 2021: Forecast at 6.4 billion pounds on a milk-fat basis and 5.7 billion pounds on a skim-solids basis.
  • 2022: Forecast at 6.5 billion pounds on a milk-fat basis and 5.5 billion pounds on a skim-solids basis.
• Export Shares:
  • Dairy exports as a share of production are expected to remain at 22.7% for both 2021 and 2022.
• Prices:
  • Fourth-quarter 2021 all-milk price forecast is $20.00 per cwt, up $0.20 from last month.
  • Annual 2021 all-milk price forecast is $18.50 per cwt, up $0.05 from last month.
  • 2022 all-milk price forecast is $20.25 per cwt, up $1.05 from last month.
  • Cheddar cheese price for 2021-Q4 is forecast at $1.730 per pound, down 4.5 cents from last month.
  • Butter price is forecast at $1.910 per pound, up 15.5 cents.
  • Nonfat dry milk (NDM) price is forecast at $1.485 per pound, up 10.5 cents.
  • Dry whey price is forecast at $0.530 per pound, up 2.0 cents.
• Ending Stocks:
  • 2021-Q4: Milk-fat basis forecast at 14.9 billion pounds, down 0.6 billion pounds.
  • Skim-solids basis forecast at 11.0 billion pounds, unchanged from last month.
  • 2022: Milk-fat basis forecast at 14.7 billion pounds, down 0.6 billion pounds.
  • Skim-solids basis forecast at 10.9 billion pounds, down 0.2 billion pounds.

Poultry and Eggs

• Broiler Exports:
  • 2021: Forecast to account for 16.8% of domestic production.
  • 2022: Forecast to decline slightly to 16.5%, as production increases by 1% and exports decrease by 1%.
• Turkey Exports:
  • 2021: Forecast to account for 10.0% of production.
  • 2022: Forecast to increase to 10.1%, with both production and exports rising slightly.
• Egg Exports:
  • 2021: Forecast to account for 5.2% of table egg production.
  • 2022: Forecast to decline to 4.6%, as exports return to more typical levels and production increases by 1%.
• Prices:
  • Broiler prices increased in the fourth quarter and first half of 2022 due to recent trends.
  • Turkey prices for the fourth quarter were raised to 135 cents per pound, and for 2022 to 122 cents per pound.
  • Wholesale egg prices for the fourth quarter were lowered to 125 cents per dozen due to lower-than-expected prices in late October and early November.

Major Viewpoints

• Beef Market:
  • Beef production and exports are expected to decline slightly in 2022, but the share of exports relative to production remains stable.
  • Strong exports to China, Japan, and South Korea have driven up the overall export volume in 2021.
  • Beef imports from Australia and Uruguay have declined significantly, while imports from Canada and Brazil have increased.
• Dairy Market:
  • The U.S. dairy herd is projected to continue decreasing in 2022, leading to a slight increase in milk production compared to 2021.
  • Dairy product prices are expected to rise in 2022 due to higher wholesale prices and lower domestic use.
  • Export volumes are expected to increase in 2022 due to strong international demand and U.S. price competitiveness.
• Poultry and Egg Market:
  • Broiler exports are expected to decline slightly in 2022, but the share of exports relative to production remains stable.
  • Turkey exports are projected to increase slightly in 2022, with a higher share of production.
  • Egg exports are expected to return to more typical levels in 2022, with a slight decrease in the share of production.

Key Information

• Beef Production:
  • Expected to increase slightly in 2021 due to higher carcass weights and fed cattle slaughter.
  • Projected to decrease in 2022 due to lower cow slaughter and a shift in marketings to the second half of the year.
• Dairy Production:
  • Expected to decrease in 2021 due to lower milk cow numbers and milk per cow.
  • Projected to increase slightly in 2022 due to improved winter pastures and a shift in cattle placements.
• Export Performance:
  • Beef exports to China, Japan, and South Korea have been strong, contributing to overall export growth.
  • Dairy exports are expected to rise in 2022 due to increased international demand and competitive pricing.
• Import Trends:
  • Beef imports from Canada and Brazil have increased significantly, while imports from Australia and Uruguay have decreased.
  • Dairy imports are expected to remain stable in 2022, with a slight increase in the skim-solids basis.
• Prices:
  • Dairy product prices, including butter, NDM, and dry whey, are expected to rise in 2022.
  • Beef prices for fed and feeder steers are projected to increase in 2021 and 2022.

Conclusion

The U.S. livestock, dairy, and poultry markets are expected to experience modest changes in production and trade volumes for 2021 and 2022. Beef production and exports are projected to decline slightly in 2022, while dairy production is expected to remain stable with a slight increase in 2022. Strong international demand and competitive pricing are expected to support higher dairy export volumes. Poultry and egg exports are forecast to remain relatively stable, with some fluctuations in prices and shares. Overall, the markets show resilience despite challenges such as lower domestic use and higher input costs.