USDA World Agricultural Supply & Demand Estimates

Released on February 8th

For 2019, the total red meat and poultry production forecast is lowered from December on lower expected beef, pork, and broiler production. The 2019 beef production forecast is reduced on lower projected slaughter as smaller anticipated placements in late 2018 and early 2019 are expected to result in lower fed cattle marketings and slaughter in the first half of the year. The pork production forecast for 2019 is lowered from December on lower expected hog slaughter and slightly lighter carcass weights in the first half of the year. USDA’s Quarterly Hogs and Pigs report estimated the September-November pig crop was 2 percent above 2017 and the report also indicated producers expect to expand farrowings about 2 percent in the first half of 2019. Forecast broiler production is lowered for 2019 on slower expected production growth in the second half of the year. The turkey production forecast is raised slightly.
Beef import forecasts For 2018 and 2019, are lowered from December on trade data to date. Pork export forecasts for 2018 and 2019 are reduced on the lowered forecast of production and slower expected pork shipments to key trading partners. The 2018 and 2019 broiler and turkey export forecasts are raised on recent trade data and expectations of firm export demand carrying into next year.
Livestock, poultry and egg prices for 2018 are adjusted to reflect December price data. Fed cattle prices for the first quarter of 2019 are raised on current prices. Hog prices are unchanged from December. For 2019, first-half broiler, turkey, and egg price forecasts are raised on prices to date.
WHEAT: The outlook for 2018/19 U.S. wheat this month is for unchanged supplies, lower exports, and higher ending stocks. Wheat exports are lowered 25 million bushels to 1.0 billion with all of the reduction in Hard Red Winter (HRW) on historically low exports for this class in the first half of the 2018/19 marketing year (MY). The reduction in HRW is partially offset by higher exports of Hard Red Spring and Soft Red Winter. Projected 2018/19 ending stocks are raised 25 million bushels to 974 million, which are still down 11 percent from last year. Based on NASS monthly prices reported to date and price expectations for the remainder of the MY, the projected season-average farm price is up $0.05 per bushel at the midpoint with the range narrowed to $5.05 to $5.25.
World 2018/19 wheat supplies are increased 0.8 million tons as additional Russian carryin stocks and a larger Canadian crop more than offset a reduction in Australian production. Based on the updated ABARES estimate, Australia’s production is lowered by 500,000 tons to 17.0 million. This would be the lowest Australian wheat output since 2007/08. Canada’s wheat production is raised 300,000 tons to 31.8 million, based on the latest estimate by Statistics Canada.
Projected global 2018/19 trade is lower, as reduced Australian, EU, and U.S. exports are partly offset by higher Russian exports, which are increased 1.5 million tons to 36.5 million. Russia and other Black Sea suppliers continue to displace EU and U.S. exports in several markets in the first half of 2018/19 but are expected to be less competitive in the second half based on reduced exportable supplies. Australia’s wheat exports are lowered 1.0 million tons to 10.5 million as its export prices are expected to remain uncompetitive and more supplies are consumed domestically for feed. Global ending stocks are raised 1.4 million tons to 268.1 million, primarily on increases for the EU and the United States but are 4 percent lower than last year’s record 279.9 million.


CORN & COARSE GRAINS: This month’s 2018/19 U.S. corn outlook is for lower corn used for ethanol, reduced imports, and larger ending stocks. Imports are lowered based on observed trade to date. Corn used to produce ethanol is reduced 50 million bushels to 5.6 billion, based on the most recent data from the Grain Crushings and Co-Products Production report and weekly ethanol production data as reported by the Energy Information Administration for the month of November. These data imply corn used for ethanol during the September to November quarter declined relative to the prior year for the first time since 2012. With no other use changes, ending stocks are up 45 million bushels from last month. The season-average corn price received by producers is unchanged at a midpoint of $3.60 per bushel but the range is narrowed 5 cents on each end to $3.25 to $3.95 per bushel.
Global coarse grain production for 2018/19 is forecast 0.3 million tons higher to 1,373.6 million. The 2018/19 foreign coarse grain outlook is for larger production, and virtuallyunchanged consumption and ending stocks relative to last month. Foreign corn production is forecast higher with increases for Ukraine, the EU, and Thailand more than offsetting reductions for South Africa and Canada. EU corn production is higher reflecting a larger forecast for Romania. Ukraine corn production is raised based on harvest results to date, and if realized, this month’s yield forecast would surpass the previous record set during 2016/17 by nearly 20 percent. South Africa corn production is lowered as dry planting conditions are expected to reduce area. Canada corn output is down on declines in both area and yield. Corn exports are raised for Ukraine, but lowered for Mexico. Imports are raised for Vietnam, Canada, Japan, Iran, and Colombia, with partially offsetting reductions for Libya and Venezuela. Foreign corn ending stocks are higher than last month, mostly reflecting increases for the EU, Mexico, Vietnam, Ukraine, and Japan, that more than offset declines for Brazil, Canada, and South Africa.