LIVESTOCK, POULTRY, AND DAIRY: The 2016 forecast of total red meat and poultry production is raised from last month as higher forecast beef production offsets lower poultry and pork production. Beef production is raised on the current pace of slaughter.
Pork production is lowered due to counter-seasonally lighter-than-expected carcass weights this quarter. Broiler and turkey production is forecast lower, largely reflecting the slower pace of slaughter in the fourth quarter. For 2017, pork and broiler production forecasts are unchanged from the previous month, but beef and turkey production forecasts are lowered. USDA will release its Quarterly Hogs and Pigs report on December 23 which will provide an indication of producer farrowing intentions into the first part of 2017. Beef production is forecast lower, reflecting lower expectations for cattle placements in late 2016. However, the ensuing decline in fed cattle slaughter will be slightly offset by higher expected cow slaughter. The turkey production forecast is lowered from the previous month as a slower pace of slaughter is expected in the second half of the year. Egg production is forecast higher for both 2016 and early 2017.
The beef import forecast is raised for 2016 based on the recent pace of trade, but is unchanged for 2017. Beef exports are raised for 2016, reflecting stronger export demand, but are unchanged for 2017. Pork imports are lowered for 2016 and 2017 on recent trade data and the expected impact of forecast growth in production on import demand. Forecast pork exports for 2017 are unchanged. Broiler and turkey export forecasts are unchanged for 2016 and 2017.
Cattle prices are forecast higher for the remainder of 2016 and through the first half of 2017 as demand has improved and is expected to carry into early 2017. Hog prices are unchanged. Broiler prices are raised for 2016 and 2017 on recent price strength. Turkey prices are lowered in 2016 and 2017 on weaker-than-expected demand. For 2016, egg prices are lowered reflecting current price data, but the price forecast for 2017 is unchanged.
The milk production forecast is lowered for both 2016 and 2017 as slower growth in cow numbers more than offsets slightly higher growth in milk per cow. Fat basis exports are raised for 2016 on higher butter exports, and skim-solids basis exports are increased on stronger sales of lactose. For 2017, fat basis exports are reduced on expected increased competition in cheese markets, but strength in lactose and nonfat dry milk (NDM) exports are expected to support higher skim-solids basis exports. Import forecasts are lowered from last month for both fat and skim-solids bases. Fat basis ending stock forecasts for 2016 and 2017 are raised on higher expected cheese stocks. Although the skim-solids basis ending stock forecast for 2016 is raised on higher-than-expected cheese and NDM stocks, the forecast for 2017 is unchanged as robust NDM exports are expected to draw down stocks during the year.
Price forecasts for cheese and butter are raised for 2016 on current price strength, but the forecasts for NDM and whey prices are unchanged. Product prices are forecast higher for 2017 as domestic demand strength is expected to carry into next year and higher export demand will support NDM and whey prices. As a result of the higher cheese and butter price forecasts, Class III and Class IV price forecasts are raised for 2016. Class III and IV prices are forecast higher for 2017 on higher component product prices. All milk prices are forecast higher at $16.05 to $16.15 per cwt for 2016 and $16.85 to $17.65 per cwt for 2017.