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- Factors to watch next year include the current weak U.S. economy, high levels of unemployment, lack of consumer confidence, political gridlock and chaos at all levels of government, and other issues.
Beef exports for 2012 are expected to be 2.5 billion pounds, down about 307 million pounds (minus11 percent) compared with 2011.
The combination of lower domestic beef production, a modest increase in imports, and slightly lower exports are expected to increase domestic net beef supply marginally in 2012 (plus 244 million pounds or 1percent).
Domestic disappearance will result in beef per capita consumption to approximately 57.5 pounds per person in 2012. Per capita consumption for 2013 is estimated to be about 55.2 pounds per person, says Prevatt.
“Also, as the U.S. population increases in the future, per-capita beef consumption likely will be lower unless U.S. beef production increases and/or imports increase.”
The average retail beef price for 2011 was $4.44 per pound. Monthly average retail beef prices, during the first eight months of 2012, averaged 25 cents higher than a year ago.
The quantity of beef clearing the market is estimated to be 244 million pounds more during 2012.
The 2012 average retail beef price is expected to be about 4 to 6 percent higher than in 2011.
“However, during 2013, retail beef prices will be tested if unemployment continues to rise, economic recovery is not sustained, and consumers are pressured by the rising costs of goods and services.”
Additionally, says Prevatt, it is very important that the U.S. continues to sustain and grow beef export markets. “These export markets could be worth $5 to $10 per hundredweight on the value of fed slaughter cattle. Growth in beef export markets also will help to moderate the price impacts of any weaknesses in U.S. broiler and pork exports.”
U.S. meat production on the whole in 2013 is expected to show a significant decline, says Prevatt.
Beef, broiler, and pork production are all expected to show decreases next year. Beef production in 2013 is expected to decrease about 1.1 billion pounds, broiler production is expected to decrease by about 0.4 billion pounds, and pork production is expected to decrease by about 0.3 billion pounds during 2013 compared with 2012.
“Any changes in these production levels or export levels of pork and broilers could have a significant effect on U.S. beef prices.
“Additionally, any further increases in feedstuff prices will likely alter these 2013 production projections. A watchful eye on the production and export levels of competing meats and feed prices will help identify potential changes in beef prices.”
Prevatt stresses that the 2013 cattle market will continue to operate with a great deal of uncertainty.
“Cattle farmers should monitor several factors, including changes in domestic beef demand, supplies of broilers and pork, export and import sales, feedstuff prices, monetary exchange rates, and adverse weather impacts.