Feed Grain Prices Surge Throughout July
27 July 2012
 
AUSTRALIA - Australian feed grain prices increased dramatically in July, underpinned by developments in international markets, reports Meat and Livestock Australia.

Feed wheat prices delivered Sydney averaged $286/tonne during July, increasing 18 per cent on the same time last year and surpassing the A$300/tonne mark in the final week of July for the first time since the middle of October 2010 (The Land).
 
In what is being described as the worst drought in 50 years, the ongoing hot conditions across the US corn belt continues to drive the rise in grain prices, while dry weather in Russia and wet conditions throughout the UK is also placing pressure on feed grain supplies.
 
Feed barley ($248/tonne) and triticale ($272/tonne) prices also rose during July, increasing 11 per cent and 18 per cent, respectively, on the same month last year. While the surging grain prices are great news for grain producers, the rising prices will challenge those livestock producers reliant on supplementary feed, particularly those in the lotfeeding industry.

Global Feed Industry Voices Alarm at Rising Feed Costs
26 July 2012

GLOBAL - The International Feed Industry Federation (IFIF) has voiced an urgent concern that the rise in feed and food costs will continue unabated for the foreseeable future, in large part due to the diversion of feed and food grains and oilseeds into biofuels. This will result in critical pressure on feed manufacturers worldwide and higher prices for consumers.

“The dramatic drought in the US has highlighted once again the rising prices of feed and food and it is clear that the production of biofuels is in direct competition with food supplies by using land and water that would otherwise be used to grow crops for human or animal consumption”, said Alexandra de Athayde, IFIF Executive Director.

Mrs de Athayde added: “If no virgin food or feed crops were used to produce fuel, we believe prices would come down again. Current policies aimed at subsidizing the production of grains and oilseeds based biofuels harm the consumer and threaten the sustainability of the feed and food chain globally.”

 “The global challenge we face is to feed 9 billion people by 2050 and to do so sustainably. IFIF calls upon governments to reconsider subsidizing grains based biofuels in order to ensure we can use all of our feed and food production for human and animal consumption so that we meet current and future demands of 60 per cent more food by 2050.”

Pig Welfare Featured Articles


Loading Facilities for Market Hogs: Saskatchewan's Top 10
Thursday, July 19, 2012




A study by Jennifer Brown, T. Stevens and Harold W. Gonyou shows that farms with high prod use actually had the longest loading time. Their paper is published in the 2011 Annual Report from the Prairie Swine Centre.
 


Harold Gonyou

 

Jennifer Brown
 
Summary
 
For many producers, loading pigs at marketing can be both stressful and time-consuming. Problems at loading also affect the welfare of animals, and can have a significant economic impact due to carcass damage, meat quality problems or increased death losses.
 
The objective of this project was to identify components of swine loading facilities and handling at loading that have the greatest value for reducing pig stress and loading time.
 
A total of 10 load-out facilities in Saskatchewan were visited in this study, and the facility design and handling methods at each was documented using photographs and video footage. Observations were compared against recommended practice to identify design features and practices that promote good handling in pigs. Suggestions to improve handling at loading include aspects of ramp design and lighting, as well as simple changes to management and handling technique.
 
Introduction
 
Loading pigs for transport to market can be stressful for pigs and their handlers. Poorly designed loading facilities increase the incidence of prod use and rough handling, and result in longer loading times. Stress associated with loading can increase the incidence of downer pigs and death losses, as well as having adverse effects on carcass and meat quality. Methods for reducing stress at loading have been identified, however few producers have adopted these changes as construction costs are high and the benefits are uncertain.
 



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 "Farms with high prod use actually had the longest loading time."






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This project documented loading facilities and handling methods in barns recognized for having good load-outs. The results provide clear suggestions for changes to facilities and management at loading, and will hopefully encourage the construction of better load-outs and adoption of practices at loading that can benefit pigs and producers.
 
The overall objective of the project was to document superior loading facilities and practices currently in used in the province of Saskatchewan. Specific objectives included; 1) the identification of 10 loading facilities that promote ease and speed of handling in market hogs; 2) evaluation of the design and management characteristics associated with each facility; and 3) preparation of a summary and educational materials for producers to aid them in improving the design and use of loading facilities.
 
Experimental Procedures
 
Saskatchewan farms with good loading facilities were identified based on information supplied by pork producers and truckers.
 



Figure 1. Covered hydraulic loading ramp with manway (looking down ramp from truck entry)
 
Once a farm was identified, the producer was contacted regarding participation in the study. Participating farms were selected from locations across the province in order to document a wide variety of load-out designs. Participating farms included corporations such as Fast Genetics and Big Sky Farms, as well as individual producers across the province. Each farm visit included a brief questionnaire on basic housing and management practices, measurements of the loading facility, and observation of the handling techniques used to move pigs at loading.
 
Load-out measurements included the width, length, and height of pens, alleys and doorways. Light intensity was measured in lux using a light metre placed at pig height at various locations throughout the load-out. Ramp angle was measured using a framing square and level, and calculating the inverse tangent of the rise over run. Any corners, flooring changes, or obstacles were documented using a digital camera.
 
Handling of pigs during loading was also recorded. For each farm visit, a video camera was either mounted in the load-out or hand operated by the producer to record handling techniques at loading. For each site, either live observations or video footage of pigs at loading were reviewed in order to assess handling technique and pig flow. Handling techniques used on farm were also evaluated on the basis of appropriate/inappropriate use of tools, handler vocalizations, handler body position, attitude, and factors affecting the flow of animals.
 
The results of this study were descriptive observations. By examining superior facilities and handling methods, and comparing them with codes of practice and recommended practice, we identified design and handling practices that were effective at reducing stress in pigs during loading.
 
Results and Discussion
 
The ten farms studied included six farrow-to-finish operations, three finishing barns and one farrow-to-wean operation. On eight farms, the pigs were housed in small to medium groups (12 to 50 pigs per pen), and on the two remaining farms, pigs were housed in large groups of 600 to 700 animals. Hogs marketed per week ranged from 160 to 1100 animals, with an average of 500 hogs shipped per week. Loading time needed to fill a standard potbelly trailer (approximately 230 pigs) ranged from 30 to 90 minutes (45 minutes on average). Key facility and handling measures at each load-out were compared against recommended practice.
 
Load-out design
 


Figure 2. Well lit load-out with concrete steps (30-cm treads). Although this load-out involves some corners, the transitions are smooth and well-lit and the alley is wide enough for multiple pigs to pass

 

Figure 3. External loading ramp allows trucker to assist without entering barn. Note also the ramp extension (on the left) used to reduce the angle of internal truck ramp to the top deck
 
Recommended practice indicates that ramp angles should be less than 20°, that ramps should be fitted with cleats and have a non-slip surface. The ramps observed on all farms met these specifications, with ramp angles ranging from 0 to 11°. Figures 1 to 3 show examples of the ramps observed. The ramp designs varied considerably but all worked well. One farm had a covered adjustable hydraulic ramp with an attached man way, which was very efficient for moving groups onto the trailer (Figure 1). As well, the adjustable ramp was used to load the top deck and reduced handling stress as it greatly reduced the angle pigs were required to climb compared to the internal truck ramp. Some farms had concrete step ramps with 30-cm treads, which the pigs readily negotiated (Figure 2). Another farm fabricated a ramp extension which was used to reduce the slope of the internal truck ramp, making it easier to load pigs onto the top deck (see Figure 3).
 
Lighting in the load-out area was also examined. It is recommended that loading facilities be well lit, with diff use incandescent lighting preferred as it reduces contrast and shadows, which may cause animals to balk. Also, when moving into a new area such as the truck, lighting should ideally change from darker to lighter, as animals may balk if required to move into darkness. Lighting levels (recorded using a light meter) showed a large variation in lighting between farms, ranging from below 100 lux at some facilities to over 1,000 lux at others. Lighting during loading was also affected by the time of loading and external weather conditions. Some facilities used an enclosed truck bay, which minimized the effects of time of day and weather conditions.
 
Other features of superior loading facilities were manways, dedicated loading pens near the load-out and external truck sheds. Manways outside of the alley allow for more efficient handling, as the handlers can easily move around and past groups of pigs without affecting their movement. This improves not only pig flow, but also handler safety.
 
Many barns had loading pens adjacent to the load-out that pigs were moved to up to a week before loading. This has the benefit of reducing mixing stress at transport and makes it much simpler to withdraw feed before transport, as well as making the loading process much faster, with reduced stress on pigs and handlers. Finally, some barns had truck sheds adjacent to the load-out. Sheds provide the advantage of having environmental conditions consistent between the barn and trailer, so pig movement onto the truck is not affected by wind, rain, cold temperatures or high contrast due to sunlight.
 
Handling practices
 
Recommended practices related to group size, distractions and handler technique and attitude were reviewed. In terms of group size, smaller groups (five to 10 animals) have been shown to be easier to move. If larger groups are moved, considerations must be made regarding the animals (level of fear and willingness to move), facilities (minimal blockage or distractions) and the handlers abilities.
 
Distractions are known to cause pigs to slow, balk or turn back, and farm managers must be observant to detect and minimize distractions in order to reduce stress and keep pigs moving. One common distraction is too many handlers, or handlers that get ahead of pigs and cause them to turn back. Several examples of this were found in the video footage and demonstrate how important it is to observe animals and minimize distractions during handling.
 
Handler technique and attitude are very difficult to define and measure, however some general recommendations include minimizing prod use, using behavioural principles such as the flight zone and herd behaviour, and maintaining a calm and consistent attitude.
 
Prod use on the farms observed was very low. In fact, the farm with highest prod use actually had the longest loading time. This is because when the prod is used frequently, pigs become less capable of responding and attempt to turn back. Several examples of good handling were found. In one example, the handler stood well behind a group of about 20 pigs as they exited the home pen, providing ‘release’. When pigs are moving well a good handler will step back and let the animals move on their own. If the handler steps in closer in an attempt to get them moving faster, the closest pigs will often turn back and escape past the handler. In another example, groups of 12 pigs were moved using handling boards and minimal prod use, and with minimal interference from handlers. The pigs exited a pre-loading pen, negotiated a turn and mounted the truck ramp calmly as there was plenty of space and the handlers provided an appropriate level of encouragement.
 
Conclusion
 
There is a large variation in facilities and handling skills across the swine industry, and often little opportunity for producers or barn employees to gain new knowledge.
 
Lighting, flooring, alley and ramp dimensions and animal handling techniques all have the potential to cause problems when moving pigs through a facility. The best load-outs in Saskatchewan are ones which have taken these factors into account.
 
The authors’ conclusions highlight the fact that handling of pigs at loading can be improved by a variety of measures. This may include extensive load-out renovations, but frequently simple changes in lighting or handling techniques can also be effective. Producers appreciate seeing designs from other facilities and discussing the practical ideas and options presented in this work.
 
Acknowledgements
 
The authors gratefully acknowledge the contribution of participating producers. Strategic program funding provided by Sask Pork, Alberta Pork, Manitoba PorkCouncil, and the Saskatchewan Agricultural Development Fund. Specific project funding was provided by Saskatchewan Ministry of Agriculture’s ADOPT programme.
 July 2012

Weekly Roberts Market Report
27 July 2012



 Michael T. Roberts
 Extension Agriculture Economist,
Dairy and Commodity Marketing,
NC State University


US - Corn exports were bearish at 19.6 mb vs. the 33.3 mb needed to meet USDA’s demand projection pace, writes Michael Roberts.

LEAN HOGS on the CME finished down on Monday. AUG’12LH futures finished $0.375/cwt lower at $93.325/cwt but $3.525/cwt lower than last Monday’s close. The DEC’12LH contract closed at $76.050/cwt; down $0.600/cwt. Losses swept the market on fears of record-high pork inventories. Heat was seen as stressing weight gains and viewed as supportive. However, slow processor demand offset support. The USDA cold storage report last Friday showed pork stocks still at record highs. Wholesale pork prices made small gains late last week.
 
CORN futures on the Chicago Board of Trade (CBOT) finished down on Monday. The SEPT’12 contract closed at $8.140/bu; off 10.5¢/bu. The DEC’12 contract closed at $7.854/bu; down 10.25¢/bu. Profit taking and prospects for wet weather were supportive. Exports were bearish at 19.6 mb vs. the 33.3 mb needed to meet USDA’s demand projection pace.
 
SOYBEAN futures on the Chicago Board of Trade (CBOT) closed down on Monday. The AUG’12 contract closed at $16.984/bu; off 59.0¢/bu. NOV’12 futures closed at $16.222/bu; down 64.0¢/bu. Non-commercial position building pressured sell-off activity. Rain forecasts also pressured prices. Exports were neutral-to-bullish. Futures look bearish with so many long positions in place given there are only six reporting weeks left in the marketing year.
 
WHEAT futures in Chicago (CBOT) closed down on Monday. SEPT’12 wheat futures finished at $9.126/bu; off 30.5¢/bu. The JULY’13 contract closed at $8.104/bu; down 9.0¢/bu. CBOT wheat futures cut losses Monday following the corn market’s test of the upside. Both commercial and non-commercial bull position accumulation has driven prices. The market remains fundamentally bullish long term.
 

Spain and EU Hog Markets
26 July 2012

 

EU - Spain's pig price continue being the Europa highest 1,38 €/ live pig Kg (0,77 USA $/ live pig pound) and same price during the last week of June, in spite of an insufficient offer the price of the pork does not rise, writes Javier Santamartina, Spain, Italy and Portugal Genesus Representative.

This explains partly to the rest of countries of Europa's center. This month there have been imported alive pigs from France and carcasses from Germany. This a rare event in this market. Spain’s export carcass, cuts to Germany and pigs to France is not significant.
 



Genesus Global Market Report
Prices for the week of July 16, 2012
 


Country

Domestic price
(own currency)

US dollars
(Liveweight a lb)
 


USA (Iowa-Minnesota)

93.50¢ USD/lb carcass

69.19¢
 


Canada (Ontario)

1.75¢ CAD/kg carcass

62.63¢
 


Mexico (DF)

22.68 MXN/kg liveweight

75.90¢
 


Brazil (South Region)

1.94 BRL/kg liveweight

43.19¢
 


Russia

95 RUB/kg liveweight

$1.31
 


China

13.35 RMB/kg liveweight

94.82¢
 


Spain

1.38 EUR/kg liveweight

75.86¢
 

There are reasons for an increase of price, the offer is scanty and does not seem to have solution, in the short term, to get it any short but of having taken place strong imports that would concern the domestic market. Therefore it seems that it will be kept stable without rising prices but keeping it stable and strong anyways. The summer heat helps pork producers to support this situation.
 
The pork markets plow depressed especially Spain and Portugal Market. There are lot concurrences between packing plants with very low margins. This situation inhibits the raises.
 
A short review of rest of main countries of Europe in pig productions:

France: Average price on farm 1,252 €/Kg hog live (0,70 $/ live pig pound) equivalent 1,437 €/kg Carcass (0,80 USA $ /pound carcass).
 
For the next months the offer with 10 per cent less of kill animals every week of this year compared to last year, and this trend probably will increase the price.
 
Denmark: Average Price 11,30 DKK (1,52€/Kg carcass) (0,85 $/ live / pound).

The prices and sales of hams and cuts from Denmark continue stable and continue fluid on international markets like Russia and China. Slaughter is down 7 per cent less compared at the same period of last year.
 
Germany: Average Price 1,27 €/kg live (0,71 USA$/ live pig pound).

Packing plans are reducing slaughter, specially the packing plans focus to export. Starting holidays period in the main producer region which normally reduces the slaughter numbers producing an expected reduction in prices for the coming weeks.
 
There is new data about the numbers of pigs in Germany. The official inventory shows 1 million more pigs this year versus previous year. There is a lot of debate about the recently release numbers by the government agency. Some experts say that data are not full comparable and talk that probably there are the same number of pigs and there is not technical reason for increasing it. Over the second half of the year the decrease of number slaughter pigs will be compensate bypiglets imported from Netherland and Denmark during the first six months of the year. The number of sows continue to getting shorter -1.34 per cent less sows (around 30.000 head less). This has been compensate with increasing in productivity (piglets/sow /year) around 2 per cent.
 
Italy: Average price 1,35 €/kg (160 kg).

Not strong demand of pork in the Italian market over the last month. Steady prices.
 
It is important to compare price between countries that the price received by producers is official price less discount in Spain (average -0,04) and in the rest of countries receive price plus premium (+0.05 depending of country).
 
Other important things for the future is the agreement of Codex Alimentarius (Food Oficial Agency ) to limit of raptomicine residues in pork in 10 micrograms per kilogram of pork and 40 micrograms in liver/kg. Raptomicine is used in finishing pigs to increase growth and to keep lean carcasses. This limit probably must be not accepted in other parts of the world and could get difficult to export pork.
 
Also the Spain crops are not doing any good and this situation added to high price of grains and specially soya. Barley (216 €/ton) and Soya (420 €/ton).
 
Summary
 
Summer will be stable in Europe with Spain leading.

ADGA 2012 National Show - Saanen Results





Premier Exhibitor:

  JHFARMS



Premier Breeder:

  COMPANEROS DAIRY GOATS



Premier Sire:

 SG CHERRYPINES STAND OUT - REDWOOD HILLS



Total Performer:

 SGCH COMPANEROS STAND OUT CAPRICE - REDWOOD HILLS





Best Udder:

  SARTYR KOJACK TREVI - SARTYR




Reserve Best Udder:

  SGCH DES-RUHIGESTELLE WINSEEKER - FERN & LAURIE ACTON






SENIOR RESULTS

 

JUNIOR RESULTS

 

GROUP RESULTS



 

SAANEN GRAND CHAMPION

 SARTYR KOJACK TREVI

EXHIBITOR: SARTYR

BREEDER: STEPHEN CONSIDINE





SAANEN RESERVE GRAND CHAMPION

 GCH COMPANEROS STAND OUT MELODY

EXHIBITOR: REDWOOD HILLS

BREEDER: COMPANEROS DAIRY GOATS







 

SAANEN JUNIOR CHAMPION

 NOBLE-SPRINGS CFS MONIKA

EXHIBITOR: DUSTIN NOBLE & JUSTYNE MCCOY

BREEDER: DUSTIN NOBLE & JUSTYNE MCCOY





SAANEN RESERVE JUNIOR CHAMPION

 JHFARMS VANILLA YAHTZEE

EXHIBITOR: JHFARMS

BREEDER: KIRK HUBBARD











PRODUCTION AWARDS





HIGH INDIVIDUAL PRODUCTION

 SG CAPRIKORN RV YGERNE - CAPRIKORN FARMS






HIGH INDIVIDUAL BUTTERFAT

 SG CAPRIKORN RV YGERNE - CAPRIKORN FARMS





HIGH LIFETIME PRODUCTION

 SGCH COMPANEROS STAND OUT CAPRICE - REDWOOD HILLS





HIGH LIFETIME BUTTERFAT

 SGCH COMPANEROS STAND OUT CAPRICE - REDWOOD HILLS


 



Official 2012 National Show Photographer
 STEVE POPE

ADGA 2012 National Show - Recorded Grade Results





Premier Exhibitor:

  CALIFORNIA



Premier Breeder:

  UNIVERSITY OF CALIFORNIA, DAVIS



Premier Sire:

 



Total Performer:

  GCH HAYCREEKS SD SPRING - MORGAN ALLEN





Best Udder:

  CALIFORNIA ELANDER CATALINA - CALIFORNIA




Reserve Best Udder:

  CH PLEASANT-GROVE COBRA SLITHER - PLEASANT-GROVE






SENIOR RESULTS

 

JUNIOR RESULTS

 

GROUP RESULTS



 

RECORDED GRADE GRAND CHAMPION

 CH PLEASANT-GROVE COBRA SLITHER

EXHIBITOR: PLEASANT-GROVE

BREEDER: CRAIG KOOPMANN





RECORDED GRADE RESERVE GRAND CHAMPION

 GCH HAYCREEKS SD SPRING

EXHIBITOR: MORGAN ALLEN

BREEDER: MORGAN ALLEN







 

RECORDED GRADE JUNIOR CHAMPION

 KRISCROSS SCM'S DAKOTA

EXHIBITOR: KRISCROSS

BREEDER: KRISTEN ELLIS





RECORDED GRADE RESERVE JUNIOR CHAMPION

 CALIFORNIA KARMA DARLA

EXHIBITOR: CALIFORNIA

BREEDER: UNIVERSITY OF CALIFORNIA, DAVIS











PRODUCTION AWARDS





HIGH INDIVIDUAL PRODUCTION

 THE TRISTON'S STARLIGHT - URBAN ACRES






HIGH INDIVIDUAL BUTTERFAT

 THE TRISTON'S STARLIGHT - URBAN ACRES





HIGH LIFETIME PRODUCTION

 GCH HAYCREEKS SD SPRING - MORGAN ALLEN





HIGH LIFETIME BUTTERFAT

 GCH HAYCREEKS SD SPRING - MORGAN ALLEN


 



Official 2012 National Show Photographer
 STEVE POPE

ADGA 2012 National Show - Nubian Results





Premier Exhibitor:

  LAKESHORE



Premier Breeder:

  SMITH, KAREN, FAUNA, TRINITY & WALTER



Premier Sire:

  WINGWOOD FARM REAL TACTITIAN - KAREN, FAUNA, TRINITY & WALTER SMITH



Total Performer:

  SGCH BLISSBERRY R ROCKIN' ROBIN - BLISSBERRY





Best Udder:

  GCH WINGWOOD FARM TAC SASHA -  KAREN, FAUNA, TRINITY & WALTER SMITH




Reserve Best Udder:

  SGCH BLISSBERRY R ROCKIN' ROBIN - BLISSBERRY






SENIOR RESULTS

 

JUNIOR RESULTS

 

GROUP RESULTS



 

NUBIAN GRAND CHAMPION

 GCH WINGWOOD FARM TAC SASHA

EXHIBITOR: KAREN SMITH & FAMILY

BREEDER: KAREN, FAUNA, TRINITY & WALTER SMITH





NUBIAN RESERVE GRAND CHAMPION

 SGCH BLISSBERRY ROCK MY WORLD

EXHIBITOR: BLISSBERRY

BREEDER: SARA KOEN-WALBERG







 

NUBIAN JUNIOR CHAMPION

 KASTDEMUR'S BODEGA BAY

EXHIBITOR: KASTDEMUR'S

BREEDER: KASTDEMUR'S DAIRY GOATS





NUBIAN RESERVE JUNIOR CHAMPION

 ALIZE VINO KATERINA

EXHIBITOR: LAKESHORE

BREEDER: COUGAR JONES











PRODUCTION AWARDS





HIGH INDIVIDUAL PRODUCTION

 GCH BLISSBERRY CATCH ME IF YOU CAN - BLISSBERRY






HIGH INDIVIDUAL BUTTERFAT

 GCH BLISSBERRY CATCH ME IF YOU CAN - BLISSBERRY





HIGH LIFETIME PRODUCTION

 SGCH JACOBS PRIDE HOLLYWOOD STAR - JACOBS PRIDE





HIGH LIFETIME BUTTERFAT

 SG CIELITO-LINDO VIOLET - CIELITO-LINDO


 



Official 2012 National Show Photographer
 STEVE POPE

Friday, July 13, 2012
Weekly Australian Cattle Summary
AUSTRALIA - This report is a collection of weekly cattle price summaries from each Australian state by the Meat & Livestock Australia (MLA).

West Australia
Tighter local cattle supplies

Conditions in the northern and eastern pastoral regions remain reasonable with moderate weather patterns being experienced. Mustering activity remains solid as expected at this time of year. Conditions in the south remain very mixed. After several weeks dry and cold weather, this week witnessed a wide spread but sporadic rainfall. Despite this, conditions in the traditional cattle regions of the southwest remain very solid with good levels of green feed reported.

Cattle numbers in physical markets lifted this week due to an increase in Muchea’s numbers and despite low and limited supplies being penned at Great Southern. Muchea’s increased cattle supplies were due to larger and solid supplies of cattle sourced from pastoral regions.

The numbers of heavy weight steers and bullocks remained limited, as were heavy weight mature heifer supplies with local trade weight yearling volumes again very limited. Young store grades of local cattle remained fair and similar to what would normally be seen at this time of year, while cow supplies remained moderate.
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Trade demand, both export and domestic remained solid throughout the classes, while feeder interest in store classes continued at solid levels. Restocker demand was also solid, particularly in lightweight classes. Local wholesalers continued to report difficult market conditions in the domestic market.

Trade demand remains solid

Vealer supplies remained very limited with numbers again confined to calf weights. Demand for these from the local, trade, retailers and restockers remained unchanged with solid market conditions remaining in place. The tight supplies of trade weight local yearlings were predominately grain assisted. Local trade and feeder demand remained similar with little or no change seen in prices. Demand from the feeder sector on medium and heavier local store steers and heifers was firm to the previous couple of weeks with little or no change realised in overall average prices

Lightweight grown classes, particularly steers enjoyed a strengthened restocker demand that improved values. Heavy weight steers and bullocks were predominately sourced from pastoral regions. Trade demand from both local and export processors remained similar and firm in these classes with little or no change seen in values. The strong demand that has been seen in cow classes over the past six months continued this week. The values of both prime local and pastoral cows remained equal, while plainer conditioned and lighter weights enjoyed an increased competition from the processing sector. Heavy weight bull prices were also unchanged on moderate supplies, while live exporters and export feeders remained active on lightweight drafts.

New South Wales
Numbers ease slightly

Total throughput eased 6% week-on-week as reported at markets by MLA’s NLRS. The largest decline was at Dubbo, being back 66% as rain affected movement throughout the drawing area. Inverell recorded a 27% decline with fewer young cattle yarded. In contrast CTLX lifted 40% on last week with numbers up across all categories. Casino increased slightly with predominately young cattle offered along with several grown consignments.

Despite a fall in supply competition was strong and feeders and restockers were competing for the better quality lines as the market generally trended dearer. Processors were also active trying to secure enough cattle for the winter months. Quality continues to be plain with a large portion of unfinished cattle available. Despite the general decline in quality there remain some well finished cattle available especially at Forbes and Tamworth.

Contributors across the state have generally left over the hook prices unchanged as supply is currently sufficient in meeting demand. Domestic and export demand continues to be the driver behind processors price levels as well as the general decline in quality available.

The majority of NSW indicators increased on the back of lower supply. The Eastern Young Cattle Indicator (EYCI) lifted 3¢ on 381.75¢/kg cwt. The vealer steer and vealer heifer indicators both strengthened 3¢ to settle on 213¢ and 209¢/kg lwt respectively. The heavy steer indicator had the largest increase up 6¢ on 195¢ while the only indicator to lose ground was yearling heifers back 2¢ on 197¢/kg lwt.

Prices strengthen

Prices reflected a reduction in yardings as buyers moved to secure cattle for the next few months. Medium weight vealer steers to restocker orders sold from 180¢ to 248¢ to average 248¢/kg. Medium weight vealer heifers pursued by processors sold 2¢ stronger on 202¢/kg.

Yearling steers sold mostly firm to dearer with light weight C2’s going to restockers from 208¢/kg. Medium weight yearling steers sold 3¢ higher on 206¢, while the heavy weight portion was firm to settle around 200¢/kg. Medium weight yearling heifers to feeder buyers ranged in price from 166¢ to 208¢ to average 191¢/kg. Heavy yearling steers to slaughter sold 6¢ higher on 189¢/kg.

The grown cattle market saw a mostly cheaper trend, with the odd exception due to quality. Medium weight grown steers to feeder orders were firm to average 192¢/kg. Good quality heavy grown steers were 5¢ dearer on 196¢, while bullocks settled on 191¢/kg. Light to medium weight grown heifers were mostly unchanged to average 173¢ and the heavy weight portion was 3¢ dearer on 179¢/kg.

Medium weight cows sold from 120¢ to 146¢ to average 135¢/kg. Heavy cows lifted 3¢ to settle around 147¢/kg. Heavy weight C2 bulls to slaughter sold from 125¢ to 176¢ to average 153¢/kg.

South Australia
Reduced Numbers

Following last week’s lower priced sale, the SA LE attracted a smaller mixed quality yarding of mainly young cattle. These sold to strong competition from the regular trade and export buyers. Feeders were also active on well bred yearling steers and heifers. Small numbers of vealers were penned with a heifer at 230¢/kg outselling the steers. Lightweight yearling steers were slightly dearer to restockers, while the trade sourced all C3 medium and heavyweights at improved levels. Yearling heifers tended to follow a similar pattern. Only small lines of grown and manufacturing steers together with grown heifers were penned, while cows tended to sell at dearer levels.

Naracoorte’s numbers fell in mixed quality runs and featured some excellent quality supplementary fed yearlings and beef cows which sold dearer. However, the price difference between good quality and plain quality moved further apart. Most of the usual SA and Victorian trade and export buyers were operating, albeit some on a limited basis due to the varying quality. Feeder and restocker orders were quite active as they sourced a mixture of young cattle, plain quality cows and some bulls.

Mt. Gambier’s numbers rose slightly after the improved prices that were paid the previous week. Overall quality tended to improve, this being most noticeable on the grown steers and cows which attracted improved prices. Some grown heavy steers sold at around 210¢ while some cows were selling over 150¢/kg. Young cattle quality remained quite mixed, with once again the price disparity getting wider on the better quality and plainer quality.

Erratic Trends

It was an erratically priced market, with few clear trends evident throughout the sales.

Vealer steers to the trade selling from 196¢ to 226¢, with B muscled sales dearer and the C muscled lower. Feeder purchases of C2 lightweights were between 195¢ and 208¢, or 8¢/kg dearer. Vealer heifers to the trade attracted prices mainly from 190¢ to 231¢ at prices unchanged to 12¢/kg cheaper. Feeders sourced C2 lightweights from 185¢ to 209¢/kg at dearer levels. Yearling steer B2 and C3 sales of medium and heavyweights with many having been supplementary fed, sold from 165¢ to 225¢ to be 2¢ to 5¢/kg dearer. Feeder C1 and C2 purchases were between 150¢ and 209¢. Yearling heifers C3 sales were from 160¢ to 215¢ at prices 1¢ to 8¢/kg more. Feeders sourced C2 heifers from 148¢ to 185¢, or 8¢/kg less.

Grown steer B2 and C3 sales to strong competition sold generally from 175¢ to 210¢, to be around 15¢ dearer and were averaging 343¢/kg cwt. The 3 to 5 score beef cows sold from 110¢ to 158¢ to be 4¢ to 5¢ dearer, and mainly 275¢ to 305¢/kg cwt.

Victoria
Throughput higher

Throughput at MLA’s NLRS increased with the majority of markets indicating an increase in comparison to last week. The total states yarding was up 16% week on week and was 11% higher compared to the corresponding week last year. Wodonga young and grown markets both increased with the weekly total up 45%. Camperdown supply almost doubled while Ballarat yarded just over 200 head. Shepparton was 44% higher and Warrnambool had similar numbers week on week. The Colac and Pakenham markets also had a similar supply while Leongatha was back by 13% compared to last week.

Vealers were in short supply however those available were well conditioned heavyweights. Yearlings dominated supply across the majority of the young cattle sales with sufficient numbers of medium weight and heavy weights available. Heavy C3 and C4 grown steers and bullocks were increasing numbers and there were also more heavy grown heifers available. Medium weight cow numbers were slightly lower however heavy beef and dairy cow throughput increased.

Increased supply brought about greater selection for buyers with all the major restockers, feeders and processors present across most markets. Wodonga notably had a very good quality selection of young cattle available particularly some supplementary fed yearlings. Despite the improved quality there were reports of stock continuing to show the effects of cold wintry conditions.

Prices rally higher

There were few vealers sold to feed on with medium C2 steers selling for $619/head or 226¢/kg. Most vealer steers were heavyweights with the medium with the B2 steers gaining 8¢ to make 226¢ while the C2 steers improved by 6¢/kg. Medium C2 vealer heifers climbed 9¢ to 204¢ while the heavy B2 heifers were 2¢ dearer at 220¢/kg. The majority of yearling steers were heavy weights with the C3 steers gaining 5¢ and the C4 steers dearer by 2¢, both grades selling at 205¢/kg. Light yearling heifers sold to feeders for 183¢, being 11¢/kg up. Heavy yearling heifers were 1¢ dearer at 193¢ while D3 heifers were unchanged at 169¢/kg.

Heavy C3 grown steers and C4 bullocks gained 3¢ to sell at an average of 192¢/kg. Light grown D3 heifers sold unchanged for 155¢ while the heavy D4 heifers reduced 6¢ to make 159¢/kg. Heavy manufacturing dairy steers were 2¢ dearer at 158¢/kg. Medium D1 dairy cows sold for 116¢, being 3¢/kg up. Heavy D2 dairy cows were 3¢ up at 133¢/kg. Heavy D4 cows also gained 3¢ to make 149¢/kg. Heavy C2 bulls slip 4¢ to average 150¢/kg. Heavy C3 bulls gained 2¢ and sold for 167¢/kg.

Queensland
A large lift in supply

A spell of fine weather combined with more rain forecast lifted supply at physical markets covered by MLAs NLRS by 54%. The very large yarding at the Roma store sale represented half of the total cattle penned in the state for the week. Young cattle continued to dominate the selling pens in the south of the state however in the north at Mareeba the slightly smaller supply consisted of predominately cows and grown steers.

Buyer representation in the young cattle sections was generally good nevertheless similar to previous weeks with restockers selective in their purchases. Butchers at Warwick lifted prices by 15¢/kg on a small selection of vealer heifers, while wholesalers were very active on supplementary fed yearling steers and heifers.

Feed lot buyers were keen to make purchases and at Dalby provided very strong buying strength against restockers on well bred heavy yearling steers an average prices for steers returning to the paddock improved by 5¢/kg.

A full gallery of export buyers was present and operating at most markets. However at mid week sales despite one export processor not operating to full capacity average prices managed to improve in places.

Some good bullocks were penned at late week sales, however average prices suffered due to a large number of plainer bullocks yarded. Plain cows continue to meet strong support from restockers as well as processors and slaughter lines managed to improve by a further 4¢/kg. A fair sample of good heavy cows across all markets for the week averaged 1¢/kg better.

Cows dearer

The largest numbers of calves returned to the paddock at 211¢ and sold to 228.2¢, while a fair supply of D muscle lines sold to the trade at 187¢/kg. The largest sample of vealer steers returned to the paddock at 217¢ the occasional well bred pen to 240.2¢/kg. Vealer heifers in the south of the state sold to processors at around 200¢ with the occasional sale to local butchers at 244.2¢/kg. A large selection of lightweight yearling steers returned to the paddock 6¢ dearer at 217¢ with sales to 234.2¢/kg. Medium weight C2 feeders averaged 209¢ while the top end quality of the C3s made to 227.2¢/kg. Heavy weights to feed averaged 194¢ while a large consignment returned to the paddock at 202¢ and sold to 205.2¢/kg some returning $1082/head. Lightweight yearling heifers were well supplied and restocker lines averaged 203¢ while feeder and slaughter classes generally sold in the low to mid-190¢/kg range.

Heavy grown steers to export slaughter averaged 183¢ and bullocks mostly sold around 179¢ with a few sales to 187.2¢/kg. Medium weight 1 score cows to processors averaged 4¢ dearer at 117¢ and a large number of 3 scores averaged 134¢/kg. Good heavy cows made to the occasional 163.2¢ with most 1¢ better at close to 151¢/kg.

CME: Changes to Forecasted Meat, Poultry Output Muted
13 July 2012

 

US - Spreading drought conditions prompted a number of changes to the latest USDA estimates of corn, soybean and wheat production. But even as USDA reduced corn feed use by some 650 million bushels (12 per cent), the changes to forecasted beef, pork and poultry output were more muted, write Steve Meyer and Len Steiner.

This is in part because the earlier June meat forecasts were not as aggressive as the grain estimates (e.g. 166 bu/acre). USDA made modest adjustments to its forecasts for beef production in 2012 and 2013 and the overall trend continues to be towards steady reductions in both beef output and per capita disappearance. Broiler and pork production is expected to increase, albeit at a slower pace than earlier expected.
 


Below is a recap of the latest USDA projections:

Beef: USDA currently projects total US beef production for 2012 at 25.274 billion pounds, 1.018 billion pounds or 3.9 per cent lower than the previous year. This projection is about 90 million pounds higher than the June number, in part due to more cows now forced to slaughter from deteriorating pasture conditions. The forecast is for 2013 beef production to be 24.656 billion pounds, 618 million pounds or 2.4 per cent lower than in 2012. USDA made only modest changes to US beef trade forecasts. The latest estimate is for beef exports in 2012 to be 2.588 billion pounds, some 200 million pounds or 7.2 per cent lower than a year ago. Beef export data through May showed exports were down 10 per cent from a year ago and USDA does not expect a major recovery in US beef exports in the second half of the year. High prices, a stronger US dollar and slower global economic growth is seen keeping US beef exports in check. Currently USDA is forecasting US beef exports in 2013 to increase by 2.4 per cent but it will largely depend on how the broader global economy progresses, particularly in emerging markets. A stronger US dollar has been an impediment so far this year and it will remain a key driver going forward. Per capita beef disappearance has been on a downtrend for more than a decade and the latest balance table continues to show further erosion in beef supply availability in the domestic market. Per capita consumption in 2012 is forecast at 56.1 lb/person, down 2.1 per cent from the previous year. Per capita beef disappearance is expected to decline another 2.9 per cent from a year ago. Since 2007, just before the bottom fell out of the housing market, US per capita beef disappearance is down 17 per cent. And with ongoing liquidation of the beef cow herd, it will be very difficult to increase beef production any time soon.
 
Pork & Broilers: As corn futures are flirting with $8 per bushel and projections of hog breakevens surge higher, USDA expects US pork supplies to increase both in 2012 and 2013. Total pork production for 2012 is forecast at 23.315 million pounds, some 540 million pounds or 2.4 per cent higher than a year ago. The forecast was slightly lower than the June estimate. USDA now is forecasting pork production for 2013 to be 23.697 billion pounds, 1.6 per cent higher than a year ago. USDA shaved almost half a percentage point from its previous forecast but will likely wait until the feed supply picture becomes clearer before being more aggressive in projecting pork supplies for next year. Pork exports remain the big story as they now account for about 22 per cent of US pork production. The forecast is for pork exports in 2012 to be 5.404 billion pounds, 4.1 per cent higher than a year ago. Exports are expected to be less than 1 per cent higher in 2013. As for broiler production, this remains the biggest wild card given the dramatic increase in both corn and soybean meal prices. USDA did not change its estimate for broiler production in 2012, pegging it at 36.495 billion pounds, 0.8 per cent lower than a year ago. However, USDA reduced expected broiler output for 2013 by almost 400 million pounds, now forecasting just a 0.6 per cent increase from 2012.
 

11 July 2012
USDA World Agricultural Supply and Demand Estimates (WASDE) July 2012



 


LIVESTOCK, POULTRY, AND DAIRY:

The forecast for total meat production in 2012 is raised from last month as higher pork and poultry production more than offsets lower beef production. Although remaining below last year, hatchery data are pointing towards smaller declines in eggs set and heavier bird weights are adding to production. Turkey production is also forecast slightly higher, based on recent production data. Pork production is raised on heavier expected carcass weights. USDA’s Quarterly Hogs and Pigs report will be released on June 29 and provide an indication of producer farrowing intentions for the remainder of the year. Beef production is reduced slightly as lower steer and heifer slaughter more than offsets higher dressed weights and higher cow slaughter. Small changes are made to 2013 beef and pork forecasts, largely reflecting higher expected carcass weights. Broiler and turkey production forecasts for 2013 are unchanged. Offsetting changes are made to 2012 quarterly egg production forecasts but the annual forecasts for 2012 and 2013 are unchanged from last month.

Forecasts for 2012 beef, broiler, and turkey trade are adjusted to reflect first-quarter data. Forecasts for 2013 are unchanged from last month. Pork exports for 2012 are raised from last month on the strength of trade data to date with a slight increase in forecast exports for 2013. The cattle and turkey price forecasts for 2012 are unchanged from last month, but hog and broiler prices are reduced, reflecting larger production. Egg prices for 2012 are raised as recent prices have been stronger than expected. Prices for 2013 are unchanged.

The milk production forecast for 2012 is raised as cow numbers are expected to decline more slowly. The production forecast for 2013 is unchanged. Export forecasts are raised for both 2012 WASDE-507-5 and 2013 on expected strength in cheese and nonfat dry milk (NDM) sales. Imports on a skimsolids basis are reduced slightly on lower expected imports of several dairy products.

NDM and whey prices for 2012 are forecast lower than last month on higher production and weaker demand. However, the cheese price is raised at the low end of the range on stronger demand and the butter price range is narrowed. The Class III price forecast is lowered from last month as the weaker whey price more than offsets the slightly higher forecast cheese price and the Class IV price is lowered on the weaker NDM price. The all milk price forecast for 2012 is lowered to $16.85 to $17.25 per cwt. The all milk price for 2013 remains unchanged from last month at $17.25 to $18.25 per cwt.



WHEAT:

Projected U.S. wheat supplies for 2012/13 are lowered 51 million bushels with reduced carryin and lower forecast winter wheat production. Beginning stocks are lowered 40 million bushels with a 10-million-bushel increase in food use and a 30-million-bushel increase in exports for 2011/12. The increase in 2011/12 food use reflects higher-thanexpected flour milling during the January-March quarter as reported by the North American Millers’ Association. Exports are increased based on the strong pace of U.S. shipments during the final weeks of the old-crop marketing year.

U.S. all wheat production for 2012/13 is projected at 2,234 million bushels, down 11 million, with lower forecast winter wheat production and small reductions in forecast durum wheat production for Arizona and California. Winter wheat production is forecast 10 million bushels lower with reductions for Hard Red Winter (HRW) and Soft White Winter wheat. The largest production declines are in the HRW states of Nebraska and Colorado, but higher production for Oklahoma is partly offsetting. With reduced supplies and higher expected prices, feed and residual use is lowered 10 million bushels. Ending stocks for 2012/13 are projected 41 million bushels lower. The projected range for the 2012/13 season average farm price is raised 10 cents on both ends to $5.60 to $6.80 per bushel. This remains well below the record $7.25 per bushel projected for 2011/12.

Global wheat supplies for 2012/13 are lowered 7.0 million tons with beginning stocks lowered 1.5 million tons and world production expected down 5.5 million tons. Higher 2011/12 global consumption, fueled by increased global trade, reduces carryin for 2012/13. World production for 2012/13 is lowered reflecting reduced crop prospects in several exporting countries including Russia, EU-27, Turkey, and the United States. Russia production is reduced 3.0 million tons due to a continuation of spring dryness in key winter wheat producing areas and indications of crop development problems resulting from winter freeze damage. EU-27 production is reduced 1.0 million tons with reduced acreage in Germany, Poland, and Spain, only partly offset by higher expected yields in France and Bulgaria. Production is also lowered 1.0 million tons for Turkey as winter frost damage and disease problems reduce yields across the central growing areas on the Anatolia Plateau. Output is reduced 0.2 million tons for Syria as yield prospects decline for non-irrigated wheat in the country’s northeast.

Global wheat consumption for 2012/13 is lowered 4.6 million tons with reduced prospects for wheat feeding and food use. Wheat feeding is lowered for EU-27, Russia, and Turkey. Larger corn supplies and increased corn feeding more than offset the reduction for EU-27. Wheat food use is lowered for India, Bangladesh, and Indonesia. Increases in food use for Morocco and Turkey are partly offsetting. Global wheat exports are reduced 1.6 million tons WASDE-507-2 with a 2.0-million-ton reduction for Russia and 0.3-million-ton reductions for both Argentina and Turkey. India exports are raised 1.0 million tons as market conditions improve the competitiveness of private exports. World ending stocks for 2012/13 are projected at 185.8 million tons, down 2.4 million from last month.

COARSE GRAINS:

U.S. feed grain supplies for 2012/13 are virtually unchanged as adjustments to 2011/12 balance sheets are largely offsetting and projected 2012/13 production and use are unchanged on the month. Projected 2012/13 season average price ranges for corn, sorghum, barley, and oats are all unchanged.

Adjustments to corn usage for 2011/12 reflect the latest ethanol production and trade data. Corn used to produce ethanol in 2011/12 is projected 50 million bushels higher. Weekly ethanol production has increased since mid-April after gradually declining from the record levels of late December. The higher corn use projection assumes slightly lower ethanol production during the June-August quarter as compared with the same period last year. Corn exports are projected 50 million bushels lower as shipments and sales continue to fall off of the pace needed to reach last month’s projection. Tight domestic supplies and increased competition, especially from Brazil, are also expected to reduce U.S. export prospects during the summer months. Projected corn ending stocks for 2011/12 are unchanged, as is the 2011/12 season average farm price which remains at $5.95 to $6.25 per bushel.

Changes to the 2011/12 balance sheets for sorghum, barley, and oats are driven by the latest trade data and also mostly offsetting. Sorghum exports for 2011/12 are projected 10 million bushels lower, but offset by a 10-million-bushel increase in expected feed and residual use. Projected barley imports are raised 4 million bushels and exports are lowered 3 million bushels boosting ending stocks 7 million bushels. Oats ending stocks are projected 10 million bushels lower with projected imports lowered 15 million bushels and feed and residual use reduced 5 million bushels. Projected 2011/12 farm prices for all three feed grains are unchanged.

Global coarse grain supplies for 2012/13 are projected 4.8 million tons higher with increases in corn beginning stocks and production. Global corn beginning stocks are increased 1.6 million tons mostly reflecting higher 2011/12 production for Brazil and China. Brazil corn production is raised 2 million bushels for 2011/12. Despite lower reported area for the main season crop, the rapid expansion in area and nearly ideal weather for the second season (safrinha) crop is boosting Brazil’s corn production prospects to a record 69 million tons. Much of the expansion in safrinha corn has been in the Central West region, where corn is planted in January and a pronounced dry season typically begins by early May. This year’s rainy season extended through early June providing an additional 4 to 6 inches of beneficial rainfall for filling corn. China’s 2011/12 corn production is raised 1.0 million tons in line with recent revisions to official government estimates.

World corn production for 2012/13 is increased 4.2 million tons this month with increases in China, EU-27, and FSU-12. China production for 2012/13 is raised 2.0 million tons based on higher reported corn area as land planted to soybeans declines. EU-27 corn production is increased 1.1 million tons mostly on higher area and yields for Hungary. Production is up 0.8 million tons for Russia and 0.3 million tons for Belarus both on higher reported area. World barley production is lowered, however, with a 0.5-million-ton reduction for Turkey and 0.2- million-ton reduction for Syria.

Global 2012/13 coarse grain trade is projected higher this month on increased imports and exports of corn. Corn imports are raised for EU-27 and Indonesia. Corn exports are WASDE-507-3 increased for Russia and Belarus, both reflecting higher expected production and supplies. Higher imports and production support increased corn feeding in EU-27. Higher beginning stocks and production in China boost prospects for feeding, but a partly offsetting reduction in industrial use limits the increase in corn consumption. Russia corn feeding is lowered 0.3 million tons reflecting slower expected year-to-year growth in feed grain consumption with rising feeding efficiencies in pork and poultry production. Global corn consumption is increased 2.4 million tons. Global corn ending stocks are projected 3.4 million tons higher. Of the increase, 2.0 million tons are for China and 1.0 million tons are for Brazil.

RICE:

 A reduced 2011/12 U.S. rice ending stocks forecast results in a tighter supply outlook for 2012/13. Beginning stocks for 2012/13 are reduced 4.5 million cwt to 29.5 million—down 39 percent from the previous year, and the lowest beginning stocks since 2004/05.

Production and imports for 2012/13 are unchanged at 183.0 million cwt and 22.0 million, respectively. On the 2012/13 use side, domestic and residual use is lowered 1.0 million cwt to 122.0 million because of an expected decline in rice used in the brewing of beer—a trend observed in recent years. Monthly data recently released by the U.S. Department of the Treasury confirm the downward trend in 2011/12. Rice used in the brewing of beer through March is down 11 percent in 2011/12. The 2012/13 export forecast is lowered 2.0 million cwt to 87.0 million because of reduced exportable supplies—all in long-grain rice. U.S. 2012/13 ending stocks are projected at 25.5 million cwt, down 1.5 million from last month.

Smaller projected 2011/12 U.S. imports along with larger exports reduce 2011/12 ending stocks by 4.5 million cwt. U.S. rice imports for 2011/12 are projected at 20.0 million cwt, down 0.5 million from a month ago based on U.S. Bureau of the Census data through March. The pace of imports has slowed in recent months. Rice exports for 2011/12 are raised 4.0 million cwt to 101.0 million because of a significant pickup in sales and shipments in April and early May, and an increase in food-aid. Rough rice exports for 2011/12 are reduced 4.0 million cwt to 31.0 million based on Bureau of the Census data through April and export sales data through the end of May. Conversely, milled rice exports are raised 8 million cwt (roughequivalent basis) to 70 million with large shipments to Asia.

Rough rice price forecasts for 2012/13 are unchanged from last month. The 2012/13 longgrain U.S. season average farm price is projected at $14.50 to $15.50 per cwt, combined medium- and short-grain rice price is $17.25 to $18.25 per cwt, and the all rice price is $15.30 to $16.30 per cwt. The midpoint of the 2011/12 all rice, long-grain, and combined medium- and short-grain prices are unchanged from a month ago, however, the price range is narrowed 10 cents on each end of the range for each.

Global 2012/13 rice supply and use is little changed from a month ago. Global rice production is projected at a record 466.5 million tons, up less than 100,000 tons from last month. Global 2012/13 exports are raised nearly 1.0 million tons mainly due to an increase for India, now forecast at 7.0 million, up 1.0 million from last month, but down 1.0 million from revised 2011/12. India’s 2011/12 exports are raised to a record 8.0 million tons. Import 2012/13 forecasts are raised for Iran and several African countries. Global consumption for 2012/13 is raised 1.0 million tons, primarily due to larger consumption for Iran, Vietnam, and several African countries. Global ending stocks for 2012/13 are projected at 104.2 million tons, down 0.7 million from last month, due primarily to a reduction for India.

OILSEEDS:

This month’s U.S. soybean supply and use projections for 2012/13 include lower beginning and ending stocks and reduced use. Lower beginning stocks reflect increased export and crush projections for 2011/12. Soybean exports for 2011/12 are raised 20 million bushels to 1.335 billion bushels reflecting increased global import demand, led mainly by WASDE-507-4 higher projected imports for China. Soybean crush is raised 15 million bushels mostly due to stronger domestic soybean meal use. Soybean ending stocks for 2011/12 are projected at 175 million bushels, down 35 million. With reduced supplies for 2012/13, soybean exports are projected at 1.485 billion bushels, down 20 million. Soybean crush is also projected lower due to reduced domestic soybean meal use. Ending stocks for 2012/13 are projected at 140 million bushels, down 5 million from last month.

Soybean, meal, and oil price projections for 2012/13 are unchanged this month. The U.S. season average soybean price is projected at $12.00 to $14.00 per bushel. Soybean meal and oil prices are projected at $335 to $365 per ton and 52.5 to 56.5 cents per pound, respectively.

Global oilseed production for 2012/13 is projected at 470.8 million tons, down 0.7 million from last month, mainly due to lower soybean and cottonseed production. China’s soybean production is reduced 0.5 million tons due to lower area as producers shift planting decisions toward corn. Brazil’s cottonseed production is also reduced due to lower area planted to cotton as world prices have declined in recent weeks. Other changes include reduced rapeseed production for EU-27, increased rapeseed production for Russia, increased sunflowerseed production for EU-27, and reduced cottonseed production for Australia and Egypt. Brazil’s 2011/12 soybean production is increased 0.5 million tons to 65.5 million while Argentina soybean production is reduced 1 million tons to 41.5 million.

SUGAR: Projected U.S. sugar supply for fiscal year 2012/13 is increased 341,000 short tons, raw value, compared with last month. The increase is due to higher beginning stocks and imports from Mexico. Mexico’s exports of sugar estimated for 2011/12 and projected for 2012/13 are increased due to higher production for both years. Production data for Mexico’s 2011/12 season are nearly complete, while the increase for 2012/13 is based on a favorable growing season since February.

COTTON:

 This month’s U.S. cotton estimates for 2011/12 and 2012/13 show small revisions in trade, which leave 2012/13 ending stocks unchanged from last month. The 2012/13 production estimate of 17.0 million bales also is unchanged, pending further information about planted area and weather developments. Exports for 2011/12 are raised by 200,000 bales, reflecting recent strong sales and shipments, while exports for 2012/13 are reduced by 200,000 bales, due to lower expected foreign import demand. Domestic mill use is unchanged. The projected range for the 2012/13 season average price received by producers is 60 to 80 cents per pound, 5 cents below last month on each end. The world 2012/13 cotton projections include lower production, consumption, and trade relative to last month, with beginning and ending stocks projected slightly higher. World production is down 1.4 million bales, as the southern hemisphere producers of Brazil, Australia, and Argentina are expected to make further cuts in area in response to the recent sharp drop in cotton prices. World consumption is reduced about 1.0 million bales, as decreases for China and Thailand are partially offset by an increase for India. With world prices falling, China’s reserve floor price will make it increasingly difficult for mills there to be competitive producers of yarn. China’s 2012/13 imports also are reduced due mainly to larger estimated beginning stocks, accounting for most of the almost 700,000-bale reduction in world trade. World ending stocks projected at a record 74.5 million bales are raised 1 percent from last month, with China expected to hold 42 percent of the total.

The most significant revisions to the world 2011/12 cotton estimates include an increase of nearly 1.8 million bales in China’s imports, reflecting the continued strong pace of deliveries, and corresponding increases in exports for India, Brazil, Australia, the United States, and Malaysia. India’s balance sheet also is revised to reflect recent indications of higher consumption; a residual has been added for each year beginning in 2006/07 to offset a deficit in stocks that would otherwise result from the available statistics for production, consumption, and trade.

Poor Growing Conditions Affect Grain Supply and Demand
12 July 2012


US - Dry weather continued to influence the crop outlook in the World Agricultural Supply and Demand Estimates released today by the Agriculture Department, according to the American Farm Bureau Federation.

The WASDE report showed smaller projected yields from June estimates across the board for US soybean and corn crops, despite increased planting acreage from last year. It also showed a decrease in projected ending stocks and feed use. According to AFBF economist Todd Davis, these trends will likely continue through the year.
 
“The reductions in the July report reflect the World Agricultural Outlook Board belief that the drought has greatly reduced the production potential for corn and soybeans,” said Dr Davis.
 
Corn yield was estimated at 146 bushels per acre, reduced by 20 bushels per acre from the June projections. The 2012-13 corn production estimate was subsequently affected, dropping to 12.97 billion bushels, a 1.82 billion bushel decrease.
 
The projected decreases in corn production will also have consequences on feed use. Ethanol use is also projected down 100 million bushels from June and export demand in corn has been reduced 300 million bushels.
 
The average projected soybean yield fell by 3.4 bushels per acre from June to 40.5 in July. Despite an increase in projected plantings, the substantial yield reduction pulled down this month’s estimate of production by 155 million bushels from June to 3.05 billion bushels. This number is slightly lower than the 2011 crop.
 
“Expect a lot of volatility in the coming year,” said Dr Davis. “As the crop size declines, USDA will make further cuts to projected use while prices climb to both curb demand and encourage production in 2013.”
 
The report projected increased corn prices of $1.30 per bushel from the June estimate to $5.90 per bushel for the 2012-13 marketing year.
 
According to Dr Davis, tighter projected stocks are to blame for the increase in prices. The 2012-13 ending stocks for corn are projected to decline 698 million bushels from June’s estimate to 1.183 billion bushels in July’s report. Soybean ending stocks don’t look any better, down 10 million bushels from June estimates to a current projection of 130 million bushels.
 
A report due out in August will have the first survey-based measure of crop yield potential. USDA will conduct producer surveys and field analysis throughout the fall and will then have a better idea of the damage done to the 2012 corn and soybean crop, according to Dr Davis.
 

US Hog Margins, 4 July 2012
05 July 2012

 

US - Margins deteriorated sharply over the past two weeks primarily due to soaring feed costs. Margins would actually have been even worse if not for a late month recovery in hog prices, particularly in nearby contracts, writes Doug Lenhart, General Manager of Genesus USA.

Projected hog finishing margins are now well below average as well as negative in both Q4 and Q1 following readings near or above the 90th percentile earlier this year.
 



Genesus Global Market Report
Prices for the week of June 24, 2012
 


Country

Domestic price
(own currency)

US dollars
(Liveweight a lb)
 


USA (Iowa-Minnesota)

97.91¢ USD/lb carcass

72.45¢
 


Canada (Ontario)

1.90¢ CAD/kg carcass

67.89¢
 


Mexico (DF)

21.23 MXN/kg liveweight

71.68¢
 


Brazil (South Region)

1.86 BRL/kg liveweight

42.37¢
 


Russia

95 RUB/kg liveweight

$1.32
 


China

13.49 RMB/kg liveweight

96.32¢
 


Spain

1.38 EUR/kg liveweight

78.72¢
 

A searing heat wave accompanied by drought has dimmed what earlier were bright hopes for this season’s corn and soybean crops especially in the Eastern Corn Belt. Crop conditions have declined steadily over the past few weeks and are now record low for this point in the growing season.
 
USDA released their June acreage and quarterly stocks reports this week, which pegged 1 June corn stocks at 3.15 billion bushels and final acreage at 96.405 million, up 541,000 from the March Planting Intentions. Soybean acreage was revised up 2.178 million from March to 76.08 million acres, with 1 June soybean stocks at 667 million bushels. All eyes are on weather though, and rainfall over the next two weeks will be critically important to stem a further decline in corn yield prospects.
 
USDA’s June All Hogs and Pigs report showed 1 June hog inventories up 1 per cent from last year and in line with expectations. June-Nov farrowing intentions were 1 per cent below last year, and the recent advance in feed costs may further discourage expansion.
 
The quick deterioration in forward profit margins has highlighted the importance of setting targets to scale into protection as the opportunities to do so can be short-lived.
 
3rd Qtr ’12 Most Recent Offering of $2.87, the low was $(0.30), the high has been $14.07 and the 5 year percentile of 50.5 per cent.
 
4th Qtr ’12 Most Recent Offering of ($5.34), the low was ($7.37), the high has been $7.19 and the 5 year percentile of 32.9 per cent.
 
1st Qtr ’13 Most Recent Offering of ($2.18), the low was ($3.78), the high has been $6.04 and the 5 year percentile of 36.0 per cent.
 
2nd Qtr ’13 Most Recent Offering of $3.84, the low was $2.83, the high has been $9.83 and the 5 year percentile of 34.1 per cent.
 
The Hog Margin calculation assumes that 73 lbs of soybean meal and 4.87 bushels of corn are required to produce 100 lean hog lbs. Additional assumed costs include $40 per cwt for other feed and non-feed expenses. Thank you to Commodity & Ingredient Hedging, LLC (CIH) for the margin data. Please visit www.cihmarginwatch.com to subscribe to the CIH Margin Watch report.
 

Pig Farmers Face an Empty Trough
13 July 2012

 

UK - Feed costs have again spiked due to global weather patterns and pig producers are facing large losses as the price they are paid is well below the cost of production.

Latest figures show it costs 170p per kg to raise a pig, but at present producers are being paid just 150p per kg – an unsustainable position.
 
These figures do not take full account of recent rises in feed prices and the cost of production is set to rise even further in the coming weeks.
 
Global weather conditions have been the major driver of the price rises, which have also affected the other main component of pig feed – soya, according to a BPEX report and the effects are being felt across Europe.
 
The report has been produced by AHDB Market Intelligence and senior analyst Stephen Howarth, the author, said: “Based on the July cost of production estimate, this means that producers are losing an average of 23p per kg, equivalent to a loss of about £18 per pig.
 
“In recent months, feed costs have risen faster than the DAPP, increasing the losses experienced by producers.
 
“Producers have now been in a loss-making position for 22 consecutive months, dating back to October 2010. Cumulative losses during this period are now approaching £200 million.”
 
The full report is available to read and download here.

or view the video with Stuart Bosworth, Farmers Weekly Pig Farmer of the Year 2011, talking about the rising costs of pig feed and how this is affecting the industry. Click here to view it.
 

Cautious Growth for Global Pig Meat Sector
09 July 2012


ANALYSIS - The long term outlook for the global pig market is good with higher prices according to market analysts from GIRA Richard Brown, writes Chris Harris.
 
Disease problems in Asia with foot and mouth disease in South Korea and PRRS in China have been beneficial for prices in the rest of the world.
 
However, Mr Brown speaking at the recent World Meat Congress in Paris said that pig meat production in China is recovering and Chinese import volumes are decreasing.
 
One threat that could disrupt the global market is African Swine Fever that is running wild in Russia and this could have a knock on effect to pig prices.
 
"The big question is 'When are the wild boars going to wander across the border into Europe and the eastern EU countries?'" Mr Brown said.
 
Another issue that is likely to affect the global pig market is the weather and the effect it will have on grain prices.
 
He warned that the weather could produce a bad harvest worldwide. Planting in North America was early, and there should be good yields, but he said that the weather could still affect it all.
 
Mr Brown also warned that the Euro zone crisis is also hitting the market together with the problems the producers are going to face meting the new regulations for loose housing for pregnant sows.
 
"This could cause price disruption in the second half of next year," said Mr Brown.
 
"There could be a big price rise next year."
 
Overall meat production is growing hitting 40 million tonnes but the growth of consumption in countries such as China is also pushing global consumption up. Global growth in pork consumption is expected to push it up to 11.2 million tonnes.
 
EU production is also expected to grow and rise by about 1.703 million tonnes while Chia will see growth of more than 6 million tonnes.
 
There is also going to be a long term growth in feed grain prices as long as some countries continue with their present biofuels policies that are taking grain away from feed.
 
Mr Brown said that the US is expected to see a gradual growth in production following the drop in consumption and consequent drop in production because of the scares over "swine flu".
 
In the EU, the German industry has benefitted from a 30 per cent expansion since 2000. Spain and Denmark have seen a 17 per cent rise in their markets and the Netherland a four per cent rise. However, Poland has seen a 21 per cent reduction in pig numbers.
 
The rise in Chinese imports of pig meat to meet the rising demand caused by an increasingly urbanised and wealthier population has mainly been supplied by Canada, the US and EU with a small amount coming from Brazil. Other exporters have been prevented from exploiting the potential of the Chinese market because of sanitary barriers, Mr Brown told the delegates.
 
In the past Brazil was reliant in the Russian market but that market has now been cut because Russia has sanitary concerns about Brazilian production.
 
To make up for the loss of the Russian market, Brazil is expanding into other markets such as China and other Asian countries.
 
While countries such as Russia and China have increased consumption, production and imports because of the rising wealth, prices have also increase greatly.
 
In conclusion, Mr Brown predicted that 2012 will be a profitable years for the global pig sector, but "with caution".
 





Chris Harris, Editor-in-Chief