The U.S. cattle inventory is expected to rise significantly over the next decade, up 7.6 million head to more than 97.4 million in 2025. Combined with rising slaughter rates, the increased numbers will steadily increase beef production nearly 4.3 billion pounds to more than 28 billion pounds by 2025, according to projections by USDA’s Economic Research Service.
Although prices for cattle are expected to decline through the next decade, lower feed prices than what’s been seen in the past several years will raise producer returns. Better returns and improved pasture are expected to provide incentives for herd expansion, ERS reported.
Feed prices are expected to rise only moderately in the next 10 years, and domestic and export demand is projected to be strong.
Domestic consumption is expected to grow steadily, increasing nearly 3 billion pounds to nearly 28 billion pounds by 2025. Beef imports to help meet that demand are expected to drop almost 400 million pounds in 2016 but increase from there by about 250 million pounds to a total of 3.3 billion pounds in 2025.
“The U.S. is projected to remain the world’s largest importer of beef, primarily of grass-fed, lean beef from Australia, New Zealand and NAFTA countries for use in ground beef and processed product,” ERS reported.
While the stronger U.S. dollar reduced beef exports in 2015, they are expected to steadily gain ground abroad beginning this year and rise nearly 1.2 billion pounds to 3.4 billion pounds by 2025.
But cattle prices are projected to soften before stabilizing and increasing slightly toward the end of the projection period. Markets are expected to decline from 2015 levels about $90 per hundredweight for calves, $86 per hundredweight for feeder cattle and 28 per hundredweight for fed steers by 2023.
ERS also expects a rise in U.S. pork and poultry production and domestic consumption and exports of those products and expects those commodities to follow the same price trend as beef during the next decade.
Pork production is projected to increase almost 3.3 billion pounds to 27.8 billion pounds by 2025. Domestic consumption is expected to rise 2.2 billion pounds to 22.6 billion pounds, and exports are expected to increase 1.2 billion pounds to 6.2 billion pounds.
Broiler production is expected to increase 4.9 billion pounds to 44.7 billion pounds by 2025. Domestic consumption is expected to rise nearly 3.4 billion pounds to 36.7 billion pounds, and exports are expected to increase 1.7 billion pounds to 8.1 billion pounds.