 |
|
|
|||||
|
|
August 26, 2004 Market Advisor: Experts See Higher Livestock Prices in 2004
Every year in midsummer, livestock marketing economists who do market analysis are surveyed to forecast their projections for meat production and livestock prices for the upcoming year. Ron Plain, extension economist at the University of Missouri, conducts the survey and tabulates the responses. The results are revealed at the annual meeting of the American Agricultural Economics Association. This year's meeting was held on Aug. 1-4 in Denver. The group expects beef production to decline 5.8 percent in 2004, with another 0.8 percent decline in 2005. The lowest individual prediction for beef production in 2004 was a decline of 7 percent, and the high prediction was for production to decrease by 4.8 percent. Prices are expected to respond favorably to the decline in production. The group predicted 1,100 to 1,300-pound USDA Choice slaughter steers in Nebraska to average $86.37 per hundredweight in 2004, up $1.68 from $84.69 in 2003. A further increase to an average of $86.69 per hundredweight was predicted for 2005. Quarterly predictions for Choice steers were $86.50 and $88.18 for the third and fourth quarters of 2004. Quarterly predictions for 2005 were $87.45, $88.21, $85.17 and $85.77 for the four quarters, respectively. USDA medium frame #1, 750 to 800 pound feeder steers at Oklahoma City were predicted to average $101.64 per hundredweight in 2004, up from $89.85 in 2003. A slight increase to $101.85 in 2005 was expected. Quarterly predictions for the third and fourth quarters of 2004 were $107.60 and $105.50, respectively. Estimates for the four quarters in 2005 were $101.20, $103.90, $102.40 and $100. The highest individual annual estimate for 2005 was $109 per hundredweight and the lowest prediction was $92 per hundredweight. The group does not forecast prices for lighter-weight feeder calves. However, feeder calves should also be stronger in the next year. The U.S. cow herd has declined for eight straight years due to drought in much of the Western U.S. cattle producing area. This will cause a tight supply of feeder calves this fall, and along with a record corn crop currently predicted by USDA, should boost feeder calf prices over last year's levels. A rule of thumb for feeder calf prices for fall 2004, is that the same weight and market class of calves, sold at the same time in 2004 as 2003, should average $10 to $15 per hundredweight higher. A word of caution: Although a record corn crop is predicted, the Northern corn producing states have experienced a cool growing season and corn maturity is behind average. An early freeze could reduce production from the predicted level. The group's average forecast for the U.S. farm price of corn was $2.40 per bushel for the marketing year beginning on Sept. 1, 2004, which is close to the same price as this year. Survey respondents expect the live price of 51 percent to 52 percent lean barrows and gilts in Iowa/southern Minnesota to average $54.10 per hundredweight during this quarter and $47.54 during the fourth quarter of 2004. The group estimated the 2004 annual average at $50.11, which would be more than $10 per hundredweight higher than last year. Market hog prices are expected to decline slightly in 2005 with an annual average of $48.40, but still be above 1998-2003 levels. Lamb prices are also expected to be higher than last year. Sheep numbers have declined in the drought-distressed Western U.S. sheep producing region. Lamb and mutton production is down about 3 percent from last year. The experts predicted USDA Choice slaughter lambs in San Angelo, Texas, to average $97.63 per hundredweight in 2004, up almost $6 from 2003. A slight decline to $97.06 was predicted for 2005. ### Source:
Tim Petry, (701) 231 7469, tpetry@ndsuext.nodak.edu |
Market Advisor: |
|
North Dakota State University |
