June WASDE Report

USDA World Agricultural Supply & Demand Estimates - Released on June 11

WASDE: Cattle, Hog, & Broiler Price Forecasts Reduced


LIVESTOCK & POULTRY: The forecast for 2019 red meat and poultry production is reduced from last month as lower forecast beef, pork, and turkey production more than offset higher broiler production. The decline in beef production largely reflects lower steer and heifer slaughter in the second half of the year. Forecast pork production is lowered from last month primarily as the pace of slaughter to date has been slower than WASDE-589-4 expected. The broiler production forecast is raised on recent hatchery data and expected heavier bird weights. Turkey production is lowered slightly on production data to date.
The 2020 red meat and poultry production forecast is lowered from the previous month. Production growth for livestock and poultry is expected to be slower as producers respond to higher feed costs. The beef production forecast is reduced on lower expected steer and heifer slaughter as incentives to add weight on pasture slows the pace of feedlot placements.

The beef import forecast is raised for 2019 on recent trade data, but the export forecast is reduced from the previous month on the current pace of beef exports to a number of trading partners. No change is made to the 2020 beef trade forecasts. Pork export forecasts for 2019 and 2020 are raised from the previous month, largely reflecting the removal of Mexico’s tariffs on U.S. pork products in late May. The 2019 broiler export forecast is reduced slightly on recent trade data; no change is made to the 2020 broiler export forecast. The turkey export forecast is unchanged for 2019 and 2020.

For 2019, the cattle, hog, and broiler price forecasts are reduced from last month, reflecting current price weakness. The 2019 turkey price forecast is raised slightly on higher secondquarter prices. For 2020, cattle, broiler, and egg price forecasts are reduced on continued demand weakness. The 2020 hog price forecast remains unchanged as slower production growth and stronger exports support prices. The 2020 turkey price forecast is unchanged.


COARSE GRAINS: This month’s 2019/20 U.S. corn outlook is for increased beginning stocks and imports, sharply lower production, reduced feed and residual use and exports, and smaller ending stocks. Beginning stocks are up reflecting a 100-million-bushel decline in projected exports for 2018/19 to 2.2 billion bushels, based on current outstanding sales and reduced U.S. price competitiveness. Corn production for 2019/20 is forecast to decline 1.4 billion bushels to 13.7 billion, which if realized would be the lowest since 2015/16. Unprecedented planting delays observed through early June are expected to prevent some plantings and reduce yield prospects. USDA will release its Acreage report on June 28, which will provide survey-based indications of planted and harvested area. With sharply lower supplies, use is projected to decline 425 million bushels to 14.3 billion, based on reductions to feed and residual use and exports. With supplies falling more than use, ending stocks are projected to decline 810 million bushels to 1.7 billion, which if realized would be the lowest since 2013/14. The season-average farm price is raised 50 cents to $3.80 per bushel.


This month’s 2019/20 foreign coarse grain outlook is for lower production, increased trade and lower stocks relative to last month. Argentina corn production is raised on increased area with higher prices. Canada corn production is lowered on reductions to both area and yield with planting delays in Ontario. Russia corn production is higher based on government data indicating larger-than-expected planted area. Barley production is lowered for the EU reflecting a reduction for Spain. For 2018/19, Brazil corn production is raised based on the latest government statistics.

Major global trade changes for 2019/20 include larger forecast corn exports for Argentina and Russia, with a partly offsetting reduction for Zambia. For 2018/19, exports are raised for Brazil and Argentina for the local marketing year beginning in March 2019 based on higherthan-expected shipments during May. Foreign corn ending stocks are lowered from last month mostly reflecting reductions for Argentina, Brazil, Canada, and the EU.
WHEAT: U.S. 2019/20 wheat supplies are down with lower beginning stocks partly offset by slightly higher production. Beginning stocks are down 25 million bushels on increased 2018/19 exports. Winter wheat production is forecast up 6 million bushels to 1,274 million with an increase to Hard Red Winter more than offsetting decreases for Soft Red Winter and White Winter. Total wheat production is now forecast at 1,903 million bushels, up 5.8 million bushels from the May forecast. Exports for 2019/20 are unchanged at 900 million bushels but feed and residual use is raised 50 million bushels to 140 million on reduced projected corn supplies. Ending stocks are lowered 69 million bushels to 1,072 million, and the season-average farm price is raised $0.40 per bushel to $5.10. The price increase reflects sharply higher wheat futures prices and reduced 2019/20 corn supplies.
World 2019/20 wheat supplies are raised 4.9 million tons on a 1.6-million-ton increase in beginning stocks and a 3.3-million-ton increase in global production. India’s wheat crop is raised 1.2 million tons on updated government data. Production in Russia and Ukraine are each raised 1.0 million tons reflecting favorable weather to date. Projected 2019/20 global trade is expanded 0.8 million tons with a 1.0-million-ton increase for Russia and a 0.5-millionton increase for Ukraine, both due to larger crops. Russian exports are now projected at 37.0 million tons and Ukraine exports are projected at a record 19.5 million. Partly offsetting is a 0.5-million-ton decrease for EU exports with greater competition from Black Sea origins. Projected 2019/20 world consumption is raised 3.6 million tons on both higher food and feed and residual use. With supplies rising more than use, ending stocks are projected up 1.3 million tons to a record 294.3 million.


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