May 26, 1999

USDA believes meat production will remain flat in 2000. An increase in poultry will offset a decline in red meat production. Total meat exports in 2000 decline 1% as lower red meat exports offset an increase in poultry exports.

Beef exports this year should increase 2% to 1.1 million tons. First-quarter exporters were stronger than projected earlier, especially to Mexico and Korea. Cattle prices this year should average about $64 per cwt., 5% more than 1998. As supplies tighten, cattle prices are forecast to increase into the low to mid-$70s in 2000.

In 2000, beef exports should decline 6% to 1 million tons since gains this year from food aid shipments to Russia are not expected to be repeated in 2000. Higher beef prices in 2000 also could have a dampening effect on exports. U.S. beef imports should increase nearly 4% to 1.3 million tons as domestic supplies tighten in 2000.

The forecast for 1999 pork production is expected to decline 2% next year to 8.39 million tons as producers continue to respond to the low hog prices of the past year. The pork export forecast for 1999 will decline 39,000 tons to 567,000 tons from slow exports to Mexico, Canada and Russia and weak exports of lower value cuts.

Pork exports should decline 4% to 544,000 tons in 2000 as food aid shipments to Russia are not repeated. U.S. pork imports remain unchanged from earlier projections at 318,000 tons this year and remain flat in 2000.

Live hog prices for 1999 now are expected to average $36-38 per cwt. from lower supplies and slaughter rates in spring and summer. Hog prices should increase about $4 per cwt. to $40-43 in 2000 due to expected production declines.

Despite continued weakness in U.S. poultry exports due to reduced sales to Russia, exporters are stronger this year than earlier expected, says USDA. Total poultry exports for 1999 now are expected to reach 2.4 million tons from stronger broiler shipment recorded so far for the winter quarter. This still represents a 5% decline from 1998, however. Poultry exports next year should increase 2% as prospects for the Russian market slowly improve. But the 2000 forecast still is slightly less than 1998 exports.