US pork, beef export sales improve in latest week

USDA Thursday reported US pork net sales of 32,300 MT for 2022 were up 27 percent from the previous week and from the prior 4-week average. Increases were primarily for Mexico (20,700 MT, including decreases of 200 MT), Japan (3,700 MT, including decreases of 100 MT), Australia (2,700 MT), Canada (1,400 MT, including decreases of 400 MT), and South Korea (1,100 MT, including decreases of 200 MT). Total net sales reductions of 100 MT for 2023 were for

Australia. Exports of 27,700 MT were down 4 percent from the previous week and 1 percent from the prior 4-week average. The destinations were primarily to Mexico (12,200 MT), China (4,300 MT), Japan (4,000 MT), South Korea (2,400 MT), and Canada (1,300 MT).

US beef net sales of 17,000 MT for 2022 were up 52 percent from the previous week and 6 percent from the prior 4-week average. Increases primarily for South Korea (5,100 MT, including decreases of 1,100 MT), China (4,500 MT, including decreases 400 MT), Japan (2,000 MT, including decreases of 1,000 MT), Taiwan (1,700 MT, including decreases of 100 MT), and Indonesia (1,000 MT), were offset by reductions for Chile (100 MT). Exports of 19,800 MT were up 4 percent from the previous week and 5 percent from the prior 4-week average. The destinations were primarily to South Korea (5,700 MT), Japan (5,000 MT), China (3,800 MT), Taiwan (1,100 MT), and Canada (1,000 MT).

War and weather imperil global food supplies

That’s according to US agriculture officials and executives as rising food prices drive shortages and protests around the world. The pressures are playing out this year as conflict in Eastern Europe disrupts exports from Ukraine, one of the world’s top crop producers, and drought and poor weather afflict major crop-growing regions. Rising food prices are prompting unrest, as disruptions in the flow of crops from Ukraine compound existing stress on global supplies of grains and other goods. The head of the United Nations World Food Program has warned outright food shortages are possible in 2023 if Russia continues to block Ukraine’s crop exports. Up to 323 million people worldwide are at risk of starvation due to the pandemic, climate change, global economic woes and warfare including Russia's invasion of Ukraine, said the leaders of the world's leading democracies. The Group of Seven committed an additional $4.5 billion on Tuesday "to protect the most vulnerable from hunger and malnutrition." The situation is less grim in Asia. Thank rice, the WSJ reports. Following successive bumper crops, rice has emerged as a rare food commodity that has generally been cheaper this year than it was last year. That’s great news for the billions of people who live across the swath of Asia where the grain is a popular staple, from India to Thailand, Vietnam and Japan. The region encompassing South, Southeast and East Asia produces and consumes more than 80% of the world’s rice.

African swine fever outbreak in Poland

In June 2022, Poland reported four new outbreaks of African Swine Fever (ASF) on hog farms, The outbreaks were located in ASF restricted areas that have a high concentration of ASF infections in wild boars. Additional outbreaks on farms are expected as the disease is more prevalent in the summer. With no new areas in Poland infected with ASF virus, the pork industry situation remains stable. Before the June reports, Poland’s last outbreak was in December 2021.

July 4 cookouts will cost $10 more this year

The average cost of a summer cookout for 10 people is now $69.68, up about 17% or $10 compared to last year, according to a new survey from the American Farm Bureau Federation. Driving up prices: Ongoing supply chain problems tied to the pandemic, the war in Ukraine and the broader jump in inflation. The spike in ground beef prices is the biggest contributor. The survey found that two pounds of ground beef now costs $11.12, a 36% leap from last year. Two-and-a-half pounds of homemade potato salad is up 19%, while hamburger buns are 16% pricier.

US food prices forecast by USDA to rise by most in more than 40 years

US food price inflation is now forecast by USDA at 7.5% to 8.5% in 2022, the highest since food prices rose 8.6% in 1980. The latest rise marks a fifth straight monthly increase in the forecast, according to USDA’s Economic Research Service (ERS). Food at home (grocery) prices are expected to rise 8.5% to 9.5% for the highest level of grocery price inflation since an increase of 10.8% in 1979. Food away from home (restaurant) prices are looked to increase 6% to 7%, unchanged from last month, but still the biggest rise since an increase of 9% in 1981.

USDA semi-annual European Union dairy report

Note: Effective January 1, 2021, the United Kingdom (UK) completed its departure from the European Union (EU), including trade between both entities. In this report if it is not indicated otherwise, the EU means the current EU27 (without the UK).

Cow numbers in the EU27 have decreased by more than 1.4 million head since 2016, including a loss of 800,000 head since 2019. Continued year on year increases in milk productivity are unable to compensate for this loss of dairy cows and the EU27 cow milk production forecast for 2022 is now 144.6 million MT (MMT), a decrease of 434,000 MT compared to 2021 and 836,000 MT down from 2020. EU dairy industry experts expect EU milk production to decline further in 2023 and after, when the new Common Agricultural Policy (CAP) and the accompanying Farm to Fork Strategy (F2F) conditionalities require EU dairy farmers to adjust their production systems.

The increase in production of non-cow milk remains strong as consumers’ appreciation for goat and ewe derived dairy products, mainly cheeses, continues to increase. Drinking milk consumption in the EU may decrease again in 2022 as people drink less liquid milk in the working place, after a spike in 2020 and 2021 when COVID19 kept people home. This should allow additional milk for dairy processing to marginally recover after a decrease in 2021 because of the reduced milk production.

Cheese production is the preferred EU27 milk factory use, and this trend is expected to continue as several new cheese plants have emerged in recent years, mainly to produce industrial mozzarella for the food processing industry. EU27 cheese production for 2022 is forecast to increase to 10.6 MMT, an increase of 50,000 MT over 2021 and almost 240,000 MT higher than production in 2020. EU cheese consumption continues to increase year after year and this should continue through 2022, but at a slowing pace due to increasing prices. The consumer appetite for Geographical Indicator (GI) and local cheeses, including goat cheeses, is growing more strongly, with higher returns for processors and local farmers alike. The slowing increase in cheese production led to lower EU27 cheese exports in 2021, but the forecast is that exports should mostly recover in 2022. The EU butter market is growing more slowly and may well start to contract in 2022, as the aging population is looking for healthier eating patterns.

Butter production decreased by 2 percent in 2021 compared to 2020 and is forecast to decrease slightly further in 2022. After a decrease at the onset of the COVID-19 crisis in 2020, EU27 domestic consumption partly recovered in 2021, to continue its decreasing trend in 2022. EU27 butter exports for 2022 is now forecast to further decrease in response to the surge in prices, after a 16 percent decrease in 2021 compared to 2020.

Non-Fat Dry Milk (NFDM) or Skimmed Milk Powder (SMP) production in the EU is the residual product from EU butter and cream production. Consequently, its production follows butter production. Therefore, EU27 2022 NFDM production is forecast to further decrease after a 4 percent dip in 2021, compared to 2020. More than half of EU NFDM production is exported. The proximity of Northern Africa and the Middle East make this region top export destinations for EU NFDM, but exports to South-Asian countries increased significantly in 2021 as a result of high demand and decreased exports from Oceania. Domestic consumption is led by feed consumption for veal production, but commercial stocks may conceal actual consumption.

Whole Milk Powder (WMP) production is usually the residual EU milk processing use and a lack of milk is forecast to further decrease production in 2022, after a 10 percent decrease in 2021 compared to 2020. The decrease in production led to a decreased consumption by the EU food industry in 2021 and is expected to continue in 2022. Similarly, EU WMP exports decreased in 2021, with a further decrease in 2022 anticipated. From a policy perspective, as the impact of Brexit and COVID-19 on European dairy markets are mostly behind us, the implementation of the new CAP and F2F initiatives in 2023 will dominate the EU dairy sectors’ concerns. Strengthening EU environmental and climate mitigation policies will only deepen those concerns. As dairy experts anticipate a new wave of dairy farmers potentially quitting the sector, the major industry players are already adapting their corporate plans and strategies, as they adjust to these new EU policy realities. Available milk supplies are redirected towards their most profitable and strategic domestic and export market interests.

USDA quarterly US hogs and pigs report

United States inventory of all hogs and pigs on June 1, 2022 was 72.5 million head. This was down 1 percent from June 1, 2021, and down slightly from March 1, 2022. Breeding inventory, at 6.17 million head, was down 1 percent from last year, but up 1 percent from the previous quarter. Market hog inventory, at 66.4 million head, was down 1 percent from last year, and down slightly from last quarter. The March-May 2022 pig crop, at 32.9 million head, was down 1 percent from 2021. Sows farrowing during this period totaled 2.99 million head, down 1 percent from 2021. The sows farrowed during this quarter represented 49 percent of the breeding herd. The average pigs saved per litter was 11.00 for the March-May period, compared to 10.95 last year.

United States hog producers intend to have 3.02 million sows farrow during the June-August 2022 quarter, down 1 percent from the actual farrowings during the same period one year earlier, and down 7 percent from the same period two years earlier. Intended farrowings for September-November 2022, at 3.01 million sows, are down 1 percent from the same period one year earlier, and down 5 percent from the same period two years earlier. The total number of hogs under contract owned by operations with over 5,000 head, but raised by contractees, accounted for 50 percent of the total United States hog inventory, up 1 percent from the previous year.

Revisions All inventory and pig crop estimates for June 2021 through March 2022 were reviewed using final pig crop, official slaughter, death loss, and updated import and export data. The revision made to the March 2022 all hogs and pigs inventory was 0.6 percent. The revision made to the December 2021-February 2022 pig crop was 0.4 percent. The net revision made to the December 2021 all hogs and pigs inventory was 0.3 percent. A net revision of 1.2 percent was made to the September-November 2021 pig crop.