WASHINGTON, Feb 21 (Reuters) – U.S. beef cattle supplies are expected to remain tight well into 2015, driving up retail Choice grade beef prices to record highs this year, despite lower feed prices and global demand for protein, the U.S. Agriculture Department said on Friday.
U.S. cattle producers plan to retain two percent more beef heifers and have one percent more heifers calve in 2014.
With less beef available, U.S. exports could fall almost 10 percent this year, while beef imports will grow about two percent. Consumers will probably see higher prices at their grocery meat counter, as retail choice beef prices are expected to jump two to three percent over the 2013 record high.
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The USDA also cautioned that there would be “considerable uncertainty” in its 2014 U.S. hog forecasts, as the deadly Porcine Epidemic Diarrhea virus reduced growth in pig farrowings in recent months and is expected to keep hog supplies tight through the first half of the year.
“Producers this far have not dramatically expanded the number of sows farrowing to compensate for the losses in litter size,” the USDA said.
Hog prices are forecast to average $61 to $65 US per hundredweight in 2014, down from last year’s $64.05.
Prices will likely average above year-ago levels in the first half, when supplies of market-ready hogs are the tightest, but slip later in the year as supplies increase.
U.S. pork exports are forecast to rise about three percent in 2014, helped by economic growth in many foreign countries and by lower prices, the USDA said.
Broiler prices are also expected to slip a bit, to between 94 cents to $1.01 per pound versus an average of $1 in 2013.
“Tight supplies of beef and improving economic conditions are likely to support stronger demand for broiler meat,” the USDA said. That will push retail prices up about one percent.
Broiler meat production is forecast to rise three percent in 2014, to 38.9 billion pounds. U.S. broiler meat exports will rise 1.8 percent to 7.50 billion pounds, the USDA said.
