u.s. and global market situation · player in global pork and poultry trade. the global slowdown...
TRANSCRIPT
National Renderers Annual Meeting
U.S. and Global Market Situation
Randy Blach
~80% U.S. Beef Cowherd~85% U.S. Corn Production
~12% U.S. Beef Cowherd~5% U.S. Corn Production
2016 +1,029,000 hdF2017 +669,000 hdF2018 +200,000 hd
+5%+6%
+7%
+7%
+8%
+7%
+3%
+5% +1.4%
+0.7%+2.6%
+7.8%
Pork and Poultry
Pork 2017
Production +2% 25.3 billion pounds
Exports +4% 5.2 billion pounds
Net Supplies +1% 21.2 billion pounds
Per capita supplies +0.5% (+0.3lbs) @ 50.42lbs
Margins remain positive
Production up 1.3% in 2016 and 1.5% in 2017
’15 = 115.4 mil. (+8%)’16F = 117.8 mil. (+2.1%)’17F = 119 mil. (+1%)
Broilers 2017
Production +2% 41.7 billion pounds
Exports +3.9% 6.7 billion pounds
Net Supplies +1.7% 35.2 billion pounds
Per capita supplies +1% (+0.93lbs) @ 92.6 lbs
’16F = 8.74 bil. (+0.6%)’17F = 8.82 bil. (+0.9%)
’16F = 241.9 mil. (+4.8%)’17F = 247.3 mil. (+2.2%)
+1.4% +1.8%
+1.5%
+1.4%
Global Situation
+1.4%
+2.6%
+1%
All regions growing with the exception of China
China declines while nearly all other regions are steady to higher
World total up about 1.05 mil. in 2016.2017 up 2.9 mil. head
Commodity Indexes turning higher
Source: Pacific Exchange, AgriTrends
10
20
30
40
50
60
70
Mil.
Lbs
. CW
E
Month
U.S. Beef ExportsCanada Mexico South Korea Japan Hong Kong Other
Source: USDA
Source: USDA/FAS
Oct. 9, 2015$159/hd.
Sep. 12, 2014$230/hd.
Sept. 30, 2016$162/hd.
-36%
-29%
-18%
-41%
Source: EIA
Inventories remain seasonal and plentiful
The U.S. will continue to be the largest beef producing country. The total U.S. herd will be nearly 8 mil head larger by 2018-2019 than it was in 2014. The Australian herd is expanding rapidly now, Brazil will continue to grow.
The U.S. will continue to grow pork and poultry production and be a major player in global pork and poultry trade.
The global slowdown that has crippled export markets the last two years is beginning to look a little more positive.
Currency wars will continue to be front and center as world markets try to kick start there economies.
Grain producers will experience prices that are near breakeven production cost for the next several years.
Most agriculture markets have declined 45-60 percent from the highs earlier in this decade. This price decline should be buying back demand.
