Analyst Jim Wyckoff studies on the protein business
24 February 2024
27 minute learn
USDA Sec. Vilsack: US ‘18 months or so’ away from discovering fowl flu vaccine
US veterinarians are “18 months or so” away from figuring out a vaccine for the present pressure of extremely pathogenic avian influenza (HPAI) and USDA is growing a course of to distribute it, Ag Secretary Tom Vilsack advised a Home Ag Committee listening to. USDA plans to debate poultry vaccinations with buying and selling companions, amid issues that different nations may prohibit imports of vaccinated US poultry, Vilsack mentioned. The US doesn’t enable poultry imports from nations affected by HPAI or from flocks vaccinated towards the illness. France’s resolution final 12 months to vaccinate geese towards HPAI prompted import restrictions.
USDA annual Ag Outlook Discussion board forecast highlights for US livestock and dairy
OUTLOOK FOR US DAIRY
The US dairy sector enters 2024 going through decrease feed costs, a smaller dairy herd, however broadly strengthening costs for each dairy merchandise and fluid milk manufacturing. The January 1 dairy cow inventories in 2024 had been 41,000 head decrease than the earlier 12 months, at 9.357 million head. Moreover, there have been about 14,000 fewer dairy substitute heifers within the herd. Cow numbers in milk manufacturing are anticipated to stabilize in 2024, ending the 12 months at about the identical degree as the start of the 12 months. The anticipated variety of cows mixed with milk per cow anticipated to proceed rising, however at a slower charge than historic averages, in addition to one extra milk day, end in milk manufacturing in 2024 rising at an annual charge of 0.7 %.
Exports are projected to develop at a quicker charge than imports, on each a fats and skim-solids foundation, as tight provides in world dairy markets make US costs comparatively extra aggressive for worldwide customers. Home use is projected to extend on a fats foundation, however decline barely on a skim-solids foundation as home customers compete for merchandise which have robust export worth. Shares are projected to tighten additional, each a fats and skim-solids foundation, because of the continued tempo of utilization and milk manufacturing. Milk costs are anticipated to be increased in 2024, as modest will increase in manufacturing, coupled with strong demand for dairy merchandise from each home and world markets help the values of most dairy merchandise. Tighter provides from main dairy exporters will help world dairy costs and help US costs, as properly. Sturdy charges of utilization and tighter shares of fats and skim-solids foundation are projected to underpin Class III and Class IV milk costs and, in flip, increase the all milk worth from 2023 ranges.
Milk Cow Inventories Decrease to Begin the 12 months, Projected to Stabilize in 2024
For 2024, US dairy producers are anticipated to face decrease feed prices and comparatively improved forage provides from the previous a number of years. Milk cow inventories have been steadily declining for the reason that starting of 2023 and development in milk output per cow continues to be decrease than historic tendencies. In 2024, projected costs for milk and dairy merchandise are decrease than the latest peaks of 2022 and 2023, however they continue to be at increased ranges in contrast with the years previous to 2020. Moreover, resilient home demand for dairy merchandise and comparatively tighter world dairy product markets are anticipated to encourage US milk manufacturing ranges.
Milk manufacturing development is projected to be constrained nonetheless, by the provision of cows and bred heifers to carry into the home milk herd. On January 1, 2024, the dairy herd was 0.4 % decrease than the earlier 12 months. Moreover, dairy heifer replacements had been additionally 0.4 decrease and the variety of heifers anticipated to calve in 2024 was down greater than 1 %. The dairy cow herd has been trending decrease since reaching a peak in 2021, as feed costs have risen and squeezed margins for milk producers. In 2023, common milk cow inventories steadily declined from 9.427 million cows within the first quarter to 9.360 million cows within the fourth quarter, largely pushed by decrease margins within the first half of the 12 months and powerful cull cow costs resulting from tight US beef markets.
Improved margins in fourth-quarter 2023 are anticipated to be a stabilizing issue for the dairy cow herd in 2024. Slaughter charges of dairy cows fell within the second half of 2023, with the pattern persevering with into January 2024. Given the comparatively tight availability of dairy substitute heifers, the decrease slaughter charges recommend that the business is more likely to keep close-to-current stock ranges for a lot of 2024. In consequence, the projection for variety of milk cows in 2024 is decrease than 2023, however the quarterly projections have inventories in the course of the fourth quarter on the similar degree they’re projected to be in the course of the first quarter.
Milk Per Cow Progress Continues To Be Slower However With Larger Element Charges
Milk manufacturing is projected to extend 0.7 % in 2024 to 228.2 billion kilos. The expansion in manufacturing is because of increased output per cow, projected to extend 0.9 % relative to the earlier 12 months, considering the additional milking day in 2024. In 2023, development in milk per cow was simply 0.1 % increased than 2022. This was largely resulting from decrease milk manufacturing ranges within the second-half of the 12 months, at the least partially resulting from extraordinarily sizzling summer season situations in a number of key milk-producing areas of the nation.
The 2024 development charge is projected increased than 2023, however is decrease than the longer-term common, reflecting the latest slowdown within the charge of development seen lately. Whereas development in milk output per cow has been slowing, this has been considerably offset by increased fats take a look at ranges seen over the past decade. This possible displays producers’ shifting productiveness focus from whole milk manufacturing to the manufacturing of parts contained inside milk. The upper fats and skim-solids contents would dampen the impression of slower development on a milk-per-cow foundation for a lot of processed dairy product markets. This shift is per the long-term tendencies of milk manufacturing tilting extra closely towards the manufacturing of processed dairy merchandise—akin to cheese, butter, and whey-containing products- quite than fluid milk.
Tighter World Milk Manufacturing Anticipated to Assist US Exports
World dairy markets are anticipated to be an influential issue within the US dairy outlook for 2024. General, world dairy commerce is anticipated to be constrained by decrease milk manufacturing in a number of key exporters—notably the European Union and New Zealand. Decrease milk manufacturing in these markets is anticipated to translate into decrease exports of a number of dairy merchandise, particularly: butter and nonfat dry milk (NDM). That is anticipated to assist help world dairy costs in 2023. The lowered manufacturing in Europe and Oceania would offer alternatives for different dairy exporters to satisfy world demand, with america properly positioned to ship product to key markets.
Sturdy Home Use of Dairy Merchandise in 2023 Tighten Inventories
The United States dairy market begins the 12 months with sharply decrease starting shares of dairy merchandise, each on a fats and skim-solids foundation. On the finish of 2023, fats foundation shares had been 4-percent decrease than the earlier 12 months, whereas skim-solids foundation shares had been 15-percent decrease. For skim[1]solids foundation merchandise, there was a very robust decline in dry whey merchandise and whey protein focus, which traditionally have been extra oriented towards export. In 2023, nonetheless, these merchandise noticed substantial will increase in home use, partially spurred by the comparatively low whey costs by a lot of the 12 months. On the fats foundation facet, butter shares had been 9 % decrease on the finish of 2023 in contrast with the earlier 12 months, as development in home use outpaced manufacturing in the course of the 12 months, serving to help butter costs. American type cheese was a notable exception in 2023, as inventory ranges elevated relative to 2022. This can be partially because of the elevated cheese manufacturing capability that has occurred over the previous decade which has resulted in manufacturing outpacing use. In 2023, uncompetitive cheese costs for a lot of the 12 months resulted in considerably decrease exports, and inventories constructed. General, home use elevated 2 % on a fats foundation and three % on a skim-solids foundation in 2023. For 2024, home use on a fats foundation is projected to extend 1 %. On a skim-solids foundation, home use is projected to say no about 1 %, as home use is anticipated to must compete with international demand. Nonetheless, at 182.0 billion kilos, the skim-solids foundation use is increased than the 5-year common, indicating continued energy in home demand for a lot of skim merchandise.
US Dairy Exports Projected Larger in 2024 for each Fats and Skim-Solids
US worth competitiveness was an necessary think about commerce in 2023. Excessive home costs for cheese and butter resulted in increased imports and decrease exports than in 2022 on a fat foundation. Likewise, weaker international demand for skim merchandise resulted in low worldwide costs. Skim[1]solids foundation exports in 2023 had been decrease than the report quantity shipped in 2022. For 2024, fats foundation exports are projected to develop at the next charge than imports; at 10 % and 1 %, respectively. This displays improved worth competitiveness for US merchandise given comparatively tight provides amongst competing exporters. Skim-solids exports in 2024 are additionally projected to be 4 % increased than 2023, though worldwide demand is anticipated to compete with US home use.
Sturdy Demand Projected to Assist US Dairy Costs in 2024
Sturdy home and worldwide demand is anticipated to be supportive for US milk and dairy product costs. The all milk worth is projected to be $20.95 per cwt in 2024, up from an estimated $20.48 in 2023. The 2024 Class IV milk worth is projected to be $20.20 per cwt, up from the 2023 estimate of $19.12 based mostly on increased butter and NDM costs. Butter costs in 2023 witnessed a powerful surge in pricing within the fall and winter, main as much as the height vacation demand interval. Whereas costs fell after vacation demand was fulfilled late within the 12 months, January 2024 costs are increased than they had been a 12 months in the past resulting from tighter shares. Moreover, robust worldwide costs in early 2024 have made US butter extra aggressive on the worldwide market, additional supporting the outlook for increased butter costs. US butter costs are projected to common $2.77 per pound in 2024, up from $2.62 in 2023—though not as excessive because the $2.87 reached in 2022. NDM costs in 2023 fell sharply, all the way down to $1.19 per pound from the report excessive costs of $1.69 in 2022. Decrease costs led to decrease manufacturing of NDM merchandise and finally sharply decrease shares on the finish of the 12 months.
For 2024, NDM costs are projected to be $1.24 per cwt resulting from improved home and worldwide demand. The 2024 Class III milk worth is projected to be $17.10 per cwt, up from the 2023 estimate of $17.02 per cwt. Class III costs aren’t anticipated to extend as a lot as Class IV resulting from a projected fall in cheese costs that can offset the projected enhance in whey. Cheese costs fell practically 17 % in 2023, to $1.76 per pound. The US has seen a dramatic enhance in cheese manufacturing since 2018, as extra manufacturing capability has been added. American-style cheese exports fell in 2023, after a considerable enhance in 2022. In consequence, inventories of American-style cheeses had been bigger than the earlier 12 months heading into 2024. That is anticipated to place downward strain on home costs. For 2024, cheese costs are projected at $1.69 per pound, a 4 % decline from 2023.
Whey costs fell sharply in 2023, from $0.61 per pound in 2022 to $0.36 per pound. Weak export demand in the course of the second half of the 12 months resulted in sharply decrease costs. The decrease costs appeared to have spurred elevated home use for whey merchandise, nonetheless. For 2024, whey costs are projected to be $0.48 per pound—up strongly from the earlier 12 months, however nonetheless decrease than 2022. The projected worth enhance is because of improved world demand for whey, which has seen costs steadily enhance for the reason that September 2023, in addition to continued agency demand from home customers
OUTLOOK FOR LIVESTOCK AND POULTRY IN 2024
USDA Complete purple meat and poultry manufacturing in 2023 declined virtually one % to 106.9 billion kilos, the primary decline in mixture meat manufacturing since 2014. The decline was pushed virtually totally by decrease beef and veal manufacturing with will increase in pork, broiler, and turkey manufacturing inadequate to offset the impacts of a multiyear drought on the cattle sector. Regardless of expectations of expanded manufacturing of pork and broiler meat in 2024, development in provides of purple meat and poultry are anticipated to be restricted by the impacts of the multiyear drought on provides of cattle and continued changes of the turkey sector to an prolonged interval of weak costs and the impression of Extremely Pathogenic Avian Influenza (HPAI) on turkey flocks in late 2023 and early 2024.
For 2024, purple meat and poultry manufacturing is forecast to extend fractionally to 107.0 billion kilos. For 2024, tighter provides of cattle are anticipated to help increased fed steer costs. Hog and broiler costs are anticipated to be increased regardless of increased manufacturing as stronger home and export demand soak up elevated provides. Turkey costs are forecast decrease than 2023 as weak demand offsets anticipated reductions in manufacturing within the first a part of 2024. Nonetheless, shifting by 2024, costs are anticipated to steadily transfer increased in the course of the 12 months and surpass 2023 by late 2024.
Feed Costs Will Decline and Forage Provides Will Enhance Feed costs throughout 2024 are more likely to be barely decrease than 2023. Corn costs within the first a part of 2024 are anticipated to be under a 12 months in the past reflecting a forecast 2023/24 crop 12 months common of $ 4.80 per bushel. Costs later within the 12 months are anticipated to be under 2023, reflecting a decline within the season common worth to $4.40 per bushel for 2024/25. Soybean meal costs within the first a part of 2024 will replicate a 2023/24 crop 12 months common of $380 per ton and costs within the fourth quarter are anticipated to replicate a market 12 months forecast of $320 for 2024/2025 as larger crush capability will increase provides of soybean meal. Hay shares on December 1, 2023, had been 75.7 million tons, 7 % increased than 2022.
Though a variety of main cattle producing States akin to Texas, Oklahoma, Nebraska, North, and South Dakota had increased ranges of shares, these ranges had been under historic ranges and plenty of cow-calf producing areas within the Southeast reported decrease inventory ranges. Cattle and Beef The cattle stock marked its fifth 12 months of contraction in 2023. The Cattle report estimated the variety of cattle and calves on January 1, 2024, at 87.2 million head, down 2 % from a 12 months earlier 3 and the bottom stock degree since 1951. The variety of cows and heifers that calved was estimated at 37.6 million head, down 2 % from the earlier 12 months. The meat cow herd was estimated at 28.2 million head, 2 % smaller than 2023 and the bottom since 1961.
The 2023 calf crop was estimated at 33.6 million head, about 2 % smaller than the 2022 calf crop. The US cattle stock will possible decline additional in 2024. The Cattle report estimated that producers retained 1 % fewer substitute heifers for the meat cow herd this 12 months, and that fewer numbers of beef heifers anticipated to calve throughout 2024. The dairy cow herd was estimated fractionally under 2023, and producers indicated intentions to carry barely fewer heifers for addition to the dairy herd. Beef and dairy cow slaughter up to now in 2024 has been under 2023 however could replicate the results of winter climate on mid-January slaughter schedules. Nonetheless, with a smaller cow base, cow slaughter is anticipated to say no in the course of the 12 months, however reductions can also replicate improved forage situations and powerful calf costs which might help retention of cows as a precursor to any herd rebuilding.
The entire variety of cattle on feed in US feedlots of all sizes on January 1 was 14.2 million head, 2 % increased than 2023 whereas the variety of cattle outdoors of feedlots on January 1 was about 4 % under a 12 months in the past. Whereas the rise in cattle on feed displays increased placements in 2023 resulting from dry situations, the tighter provides of cattle outdoors feedlots factors in the direction of decrease placements and declining feedlot numbers throughout 2024. Adjustments in producer choices regarding heifer retention over the course of the 12 months can have an effect on the degrees of heifers out there for placement, however present information would level fewer heifers retained. With an anticipated smaller pool of cattle out there for placement, feeder cattle costs are forecast increased, and these could present incentives to extend imports of cattle.
Imports of cattle are forecast at 2.05 million head in 2024, up from 1.98 million head in 2023. Though the demand pull from the US will likely be robust, imports will possible be restricted by tighter provides of cattle in Mexico and Canada. Business beef manufacturing for 2024 is forecast to fall by 3 %, to 26.19 billion kilos. Within the first a part of the 12 months, steer and heifer slaughter will replicate increased ranges of cattle in feedlots firstly of the 12 months however because the 12 months progresses, marketings will decline as feedlot numbers diminish. Moreover, cow slaughter is anticipated to say no resulting from decrease inventories and expectations that any response to bettering returns or forage will possible be manifest in producers retaining cows later within the 12 months. Heavier cattle weights, reflecting elevated occasions on feed and a reducing proportion of cows within the slaughter combine throughout 2024, will solely partly offset decrease slaughter numbers.
Beef exports declined 14 % in 2023. Among the many main markets of US beef, exports to Japan, South Korea, Canada, Taiwan, and China had been decrease, though exports to Mexico and Hong Kong elevated. Excessive US beef costs and elevated competitor provides restricted competitiveness whereas financial sluggishness in a number of key nations dampened beef demand. Complete beef exports are anticipated to say no to 2.79 billion kilos in 2024. US exports are more likely to be pressured by tightening home beef provides with the resultant increased costs making US beef much less worth aggressive. Moreover, elevated beef manufacturing in export-oriented nations akin to Australia and Brazil will possible enhance competitors in a number of markets.
Beef imports had been 10 % increased in 2023 as tighter provides of home cow beef elevated demand for imported beef trimmings. Elevated provides in Australia following years of drought supported elevated imports as did increased slaughter in New Zealand. Amongst North American suppliers, imports 4 of beef from Canada had been increased however greater than offset by decrease imports from Mexico. Imports of beef from Brazil had been decrease because the tariff-rate quota was crammed early within the 12 months and elevated imports from different sources of provide helped fill US import calls for. Imports are forecast at report 4.13 billion kilos for 2024, virtually 11 % increased than 2023.
US cow slaughter is forecast decrease for a lot of the 12 months and tighter home provides of processing-type beef are anticipated to help demand. Though imports from Brazil will likely be constrained by over-quota duties, robust US processing beef costs will proceed to make the US a horny market. As well as, increased manufacturing in Australia is anticipated to end in bigger quantities of beef for export. The 5-Space steer worth for 2024 is forecast to common a report $180.0 per cwt, eclipsing 2023’s report $175.54. Cattle costs will possible be supported by tighter provides of steers and heifers in feedlots because the 12 months progresses and comparatively agency packer demand. Feeder cattle costs are additionally more likely to eclipse 2023’s report costs as feedlots must bid for tighter cattle provides. Improved pasture situations could end in elevated competitors for lighter-weight cattle, growing prices for stocker operations. Feeder steer costs for 750–800 pound calves in 2024 are forecast to common $248.5 per cwt, in comparison with $218.69 in 2023.
Hogs and Pork
Regardless of poor returns for a lot of 2023, the hog sector is elevated manufacturing in 2024. The December 2023 Quarterly Hogs and Pigs report estimated that on December 1, 2023, the stock of all hogs and pigs was slightly below 75.0 million head, nearly unchanged from the prior 12 months. The breeding herd, nonetheless, possible mirrored weak producer margins, declining 3 % to six.0 million head. Producers indicated intentions to farrow about 1.5 % few hogs within the first half of 2024. Nonetheless, the sector is going through comparatively giant variety of hogs which must be slaughtered in the course of the first half of 2024 because the pig crop within the second half of 2023 was about unchanged from 2022.
Regardless of lowered farrowings in second-half 2023, the speed of development in pigs per litter within the final 2 quarters of 2023 averaged about 4 % greater than the prior 12 months and greater than offset the discount in farrowings. Transferring into the second half of 2024, availability of hogs for slaughter will replicate decrease farrowing within the first half of the 12 months however possible a return to pre-COVID charges of development in prigs per litter. In consequence, the primary half pig crop could also be about one % increased and these increased numbers will likely be mirrored in continued increased year-over-year ranges of slaughter.
US hog imports are forecast at slightly below 6.65 million head for 2024, down about 2 % from 2023. Imports in 2023 had been stimulated by structural adjustments within the Canadian hog and pork sectors which resulted in elevated shipments to america. As Canadian hog manufacturing in 2024 is forecast to be decrease, fewer provides are anticipated to be out there for export. Moreover, comparatively giant provides of hogs within the US could restrict the demand for Canadian hogs. Pushed by bigger pig crops in second-half 2023 and first-half 2024, industrial pork manufacturing for 2024 is forecast at 27.88 billion kilos, about 2 % increased than 2023. Along with elevated provides of market-ready hogs in the course of the 12 months, carcass weights are anticipated to extend after declining in 2023. Pork exports in 2023 elevated simply over 7 % to six.82 billion kilos.
Exports to most nations in North and Central America nations had been increased. Shipments to Mexico elevated virtually 10 %, 5 exports to Canada had been 8 % increased and exports to Central America and the Caribbean had been about 16 % increased. On the opposite facet of the world, the commerce scenario was extra of a blended bag with exports to Japan and China one % and 18 % decrease, respectively, however exports to South Korea 10 % increased and shipments to Australia up 90 %. Nonetheless, in each China and Japan, the place mixture imports had been decrease, the US was capable of acquire or keep market share, largely on the expense of the EU which had decrease manufacturing in 2023. With expectations of development in U.S pork manufacturing, firming world demand and continued constraints on EU provides, US exports in 2024 are forecast to extend about 4 % to 7.08 billion kilos. Nonetheless, US exporters will possible discover themselves going through elevated competitors in a variety of key markets from expanded Brazilian provides.
Pork imports declined 15 % in 2023 to 1.14 billion kilos. Imports from three of the 4 main import sources (Canada, the EU, and Mexico) declined at double-digit charges, however imports from Brazil, the fourth largest supply of imports was increased. Regardless of increased home US manufacturing, elevated manufacturing in Mexico and Brazil will possible make the US a horny vacation spot for pork. Nonetheless, continued tight provides within the EU could restrict imports from that area though demand could stay robust for sure specialty merchandise. US imports are anticipated to extend in 2024 to 1.20 billion kilos, 5 % increased than 2023. Nationwide base 51%-52% lean hog costs, reside equal, are forecast to common $60 per cwt for 2024, up from final 12 months’s $58.59. Regardless of elevated availability of hogs, anticipated will increase in each home and export demand are anticipated to supply help for costs.
Broiler Meat
For 2024, broiler meat manufacturing is forecast slightly below one % increased to a report 46.8 billion kilos. After a contraction in manufacturing in second half of 2023, and indications of typically decrease eggs set and chicks positioned in early 2024, increased fowl weights are serving to underpin expectations of steady-to-slowly growing manufacturing within the first a part of 2024. Broiler price-feed margins started bettering in late 2023, and with expectations of upper broiler costs and moderating feed prices by a lot of 2024, there could also be incentives to broaden manufacturing. Nonetheless, the enlargement is more likely to stay modest.
Broiler-type layers on January 1, 2024, had been estimated at lower than one % increased and the variety of broiler kind pullets hatched in December was 4 % under 2023. Egg fertility (hatchability) though comparatively secure up to now in 2024, stays under historic ranges. Thus, nearly all of the rise in manufacturing in 2024 will possible replicate increased fowl weights. US broiler meat exports for 2024 are forecast to lower fractionally to 7.22 billion kilos. Regardless of increased anticipated US provides, home demand is anticipated to help costs and dampen export competitiveness, significantly in price-sensitive markets. Though a variety of key markets are anticipated to extend whole broiler imports in 2024, elevated manufacturing in Brazil, the biggest exporter of broiler meat, will possible compete for market share in a number of key US markets.
The Nationwide Composite wholesale broiler worth is forecast to common a report $1.27 per pound in 2024, in contrast with a mean of $1.24 in 2023. Regardless of modestly bigger broiler meat provides, decrease provides of beef will possible assist help increased costs. Turkey Turkey manufacturing for 2024 is forecast to lower one % to five.40 billion kilos. Flock depopulations in late 2023 and early 2024 resulting from Extremely Pathogenic Avian Influenza (HPAI) are anticipated to constrain early-2024 manufacturing. Comparatively weak demand has stored costs at below-year[1]early ranges since June of 2023 limiting incentives to broaden.
Eggs in incubators on the primary of January had been 9 % under 2023, persevering with a pattern of under year-earlier ranges since November 2023. Month-to-month poult placements in November and December of 2023 had been additionally under earlier 12 months ranges. Nonetheless, because the sector recovers from the depopulations induced by HPAI discoveries, fowl numbers will possible enhance. Though turkey costs are more likely to stay comparatively weak, moderating feed prices are anticipated to learn the sector. With elevated flocks and extra favorable manufacturing prices, the stage could also be set for expanded manufacturing in second half of the 12 months.
Turkey exports for 2024 are forecast to extend 5 % to 515 million kilos. Mexico stays the biggest vacation spot for turkey exports, however decrease US costs could make turkey extra engaging in worth[1]delicate markets. As turkey manufacturing recovered in 2023 from the 2022 HPAI discoveries, wholesale hen costs dropped from 2022’s report excessive worth. Though costs firstly of 2023 adopted by on late-2022 costs (averaging a report for January of $1.72 per pound), apart from March, costs moved steadily decrease in the course of the 12 months. By December costs averaged $0.82 per pound, the bottom worth for that month since 2017.
Regardless of expectations of decrease manufacturing for many of the 12 months, costs are anticipated to 7 enhance solely steadily and never exceed 2023 earlier than the fourth quarter. For 2024, the common Nationwide turkey hen worth is forecast to common slightly below $1.07 per pound, in comparison with a mean of $1.40 in 2023.
Eggs
Complete US egg manufacturing in 2024 is anticipated to be 9.31 billion dozen, simply over one % increased than 2023. Initially of 2024, the sector is recovering from HPAI-related culls in November, December, and early January, which resulted within the depopulation of 13.6 million desk egg layers. Nonetheless, firstly of the 12 months, the desk egg flock was 311.8 million birds, 1.4 % above 2023. Positive aspects in late-2023 manufacturing had been additionally supported by increased ranges of eggs per fowl. Progress in eggs per layer is anticipated to hold into 2024, however as new hens are added to laying flocks, a few of the effectivity acquire perhaps misplaced. Thus, lay-rate beneficial properties later in 12 months could also be considerably slower than these earlier within the 12 months and this can have a dampening impression on manufacturing development.
Hatching egg manufacturing in 2024 is anticipated to extend solely modestly as broiler and desk egg producers solely steadily enhance their flocks. In 2023, egg and egg product exports elevated virtually 11 % from 2022’s extremely depressed ranges to 250 million dozen, shell egg equal. Though restrictions on imports from HPAI contaminated areas typically give attention to zones quite than state or nationwide ranges, US costs had been excessive, particularly within the early a part of the 12 months, limiting gross sales. Nonetheless elevated demand by Canada and Mexico helped help gross sales. For 2024, regardless of elevated manufacturing and decrease costs, exports are anticipated to be decrease as worldwide demand weakens. Exports are anticipated to say no 4 % in 2024 to 241 million dozen.
For 2024, New York wholesale egg costs are forecast to common $1.83 per dozen. Though that is down from the $1.92 common for 2023, the comparatively excessive worth displays early-year worth spikes as markets responded to issues in regards to the availability of provides of desk eggs forward of the Easter. Nonetheless, with solely modest development in manufacturing and comparatively robust demand, second- and third[1]quarter costs are anticipated to common increased than 2023.
Weekly USDA dairy report
CME GROUP CASH MARKETS (2/16) BUTTER: Grade AA closed at $2.7500. The weekly common for Grade AA is $2.7240 (-0.0200). CHEESE: Barrels closed at $1.6075 and 40# blocks at $1.4800. The weekly common for barrels is $1.5865 (+0.0095) and blocks, $1.5315 (-0.0790). NONFAT DRY MILK: Grade A closed at $1.1700. The weekly common for Grade A is $1.1835 (-0.0340). DRY WHEY: Further grade dry whey closed at $0.5200 The weekly common for dry whey is $0.5220 (+0.0145).
BUTTER HIGHLIGHTS: Retail demand is regular all through the nation. Meals service demand is robust within the East area and regular in all different areas. Cream masses are available for butter makers to make the most of all through many of the nation. Some butter plant contacts count on cream gives to be ample for the rest of the month. Butter producers are working busy manufacturing schedules to construct for anticipated spring calls for. Stakeholders word unsalted butter availability is tight. Distributors relay inquiries from worldwide clients have been extra frequent lately. Bulk butter overages vary from 4 to fifteen cents above market, throughout all areas.
CHEESE HIGHLIGHTS: Cheese plant managers relay seasonally regular manufacturing schedules within the East area. Contacts share block cheese inventories are rising. Cheese demand within the Central area is famous to be seasonally quiet. Contacts within the Midwest are specializing in constructing inventories for spring demand. Milk availability is tighter than predicted. Throughout week seven of final 12 months spot milk costs had been $10- to $2 -under Class III whereas below-Class costs for spot milk masses have but to be reported this month. Some finish customers report tight milk availability within the West, whereas others recommend Class III spot masses are typically out there when wanted. Plant managers share regular cheese manufacturing schedules. Spot cheese inventories are famous to be tighter than in latest weeks within the West. A block/barrel inversion has been in place on the CME since final Friday.
FLUID MILK: All through the East, contacts relay typically regular farm milk output. Central area output can also be famous as regular, however element ranges have receded in latest weeks. Western milk output ranges are regular to stronger from one space to the subsequent. Condensed skim demand has strengthened, and shops aren’t as out there as they had been within the early winter. Cream shops are extensively out there, as below-market multiples had been reported in each the Central and West areas. Butter crops are nonetheless taking up the majority share of cream provides within the nation, whereas ice cream manufacturing stays slower than some contacts anticipated this late within the winter season. F.O.B. cream multiples are 1.05- 1.27 within the East, .90-1.25 within the Midwest, and .90-1.20 within the West.
DRY PRODUCTS: Low/medium warmth nonfat dry milk (NDM) worth ranges moved increased within the Central/East, whereas contracting within the West. Condensed skim demand is famous as growing all through many of the nation. Dry buttermilk costs had been decrease within the Central/East, however blended within the West. Condensed buttermilk buying and selling is energetic, with ample cream shifting by churns. Dry entire milk costs had been unchanged on gradual spot market exercise. Dry whey costs elevated throughout the nation this week. Agency whey protein focus (WPC) markets have shifted manufacturing of whey solids away from drying candy whey, which has stored availability considerably cosy. WPC 34% costs had been regular to increased. WPC 34% availability has tightened up, and a few producers say their shops are anticipated to stay tighter by Q1 and Q2. Lactose costs had been blended, as export demand is famous as smooth. Casein costs had been unchanged.
INTERNATIONAL DAIRY MARKET NEWS
WESTERN EUROPEAN OVERVIEW: West European milk output has continued to rise seasonally, and a few dairy contacts say intakes aren’t as little as they anticipated to start out the 12 months. Nonetheless, milk manufacturing in lots of Western European nations continues to be trending under the degrees of the previous few years. Some dairy analysts anticipate stagnant dairy costs, excessive manufacturing prices, and regulatory constraints could hinder potential milk manufacturing development for the approaching months.
EASTERN EUROPEAN OVERVIEW: A number of nations in Jap Europe have posted month-to-month milk manufacturing beneficial properties in each month of 2023. Moreover Belarus, Poland and the Czech Republic have had vital milk manufacturing development this final 12 months. In line with CLAL information made out there to USDA, December 2023 cows’ milk delivered to dairies in Poland was 1,070,000 MT, up 1.9 % from December 2022. Within the Czech Republic, December 2023 cows’ milk delivered to dairies was 268,000 MT, up 2.0 % from December 2022.
OCEANIA: AUSTRALIA: Contacts in Australia say milk output is declining however is doing higher than it was this time final 12 months. Contacts word milk manufacturing was under expectations in the course of the summer season of the 2022/2023 manufacturing season and say climate within the nation this 12 months has contributed to improved output. Trade sources point out rainfall in the course of the summer season months has contributed to favorable feed high quality and higher climate situation. Regardless of this, some contacts say they anticipate total manufacturing all through the 2023/2024 manufacturing season to stay even with the prior season.
NEW ZEALAND: In New Zealand, business sources report farmers are rising extra optimistic about milk costs, following latest worth will increase together with decrease inflation impacting farms. Farmers in some elements of the nation relay milk manufacturing is trending increased than anticipated for this time of 12 months. Some farmers are, reportedly, involved with dry climate and whether or not a drought will come within the coming months. Opinions are blended on if a beforehand forecasted drought will emerge within the coming months and lengthen into autumn or if the time for the drought has handed.
SOUTH AMERICA: In New Zealand, business sources report farmers are rising extra optimistic about milk costs, following latest worth will increase together with decrease inflation impacting farms. Farmers in some elements of the nation relay milk manufacturing is trending increased than anticipated for this time of 12 months. Some farmers are, reportedly, involved with dry climate and whether or not a drought will come within the coming months.
US NATIONAL RETAIL REPORT: Retail commercial totals decreased on each the traditional and natural aisles this week, 17 and 19 %, respectively. Typical butter advert totals slipped 11 %, however one-pound standard butter maintains the title of being essentially the most marketed dairy merchandise throughout week seven. Typical yogurt advert totals, the one standard dairy commodity with advert numbers that moved increased, elevated 11 %. One-pound standard butter had a weighted common marketed worth of $4.66, $.13 increased than final week’s worth.
