USDA Economic Research Service Reports Increased Production, Import & Export Forecasts Raised For 2021

The October beef production numbers are in from the U.S. Department of Agriculture National Agricultural Statistics Service, which reports that inferred carcass weight was up 4.7 pounds month-over-month to 831.8 pounds. The heavier-than-anticipated carcass weights, in combination with the expected pace of fed cattle slaughter, raised the forecast for 2021 beef production by 53 million pounds to 27.885 billion pounds. The USDA also increased the forecast for 2022 beef production to 27 billion pounds, up 5 million pounds from September.

Fed Steer Prices Rising

Average price for all grades of live steers (sold in the five-area marketing region) were up 16.6% year-over-year this October at $124.33 per cwt (hundredweight). Both the Q4 2021 forecast and 2022 annual forecast for fed steers were raised, with the former being based on the current price strength and the latter building on the continued values and expected gains in packer demand.

Beef Imports Show Strength From Major Suppliers

Imports from Canada and Brazil displayed major YOY improvement and the largest increase year-to-date for import shares. Compared to September of last year, imports from Canada were up 19% YOY and Brazil increased by 49% YOY, up nearly 12 million pounds. Q3 2021 beef imports were down 10% from last year’s Q3 record, but when compared to the five-year average, Q3 2021 scored as an 11% increase. The USDA increased the Q4 2021 import forecast, as well as the 2022 forecast, based on the continued demand.

Asia-Pacific Markets Fueling Beef Exports

Beef exports for September were up 20.9% YOY, an improvement of nearly 50 million pounds. China accounted for much of September’s increase, as exports to the Chinese market increased by 313%. September 2021 also marked the largest export volume of beef to Japan since 2018. The export increases throughout Q3 2021 contributed to a new single-quarter record for beef export volume. The Q4 2021 forecast and annual 2021 export forecast were both raised based on the strong demand.

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Source: USDA