World Agricultural Supply and Demand Estimates

LIVESTOCK, POULTRY, AND DAIRY: The 2011 forecast of total red meat and poultry production is
raised reflecting higher beef production, but lower pork production. Continued large cow slaughter is
expected to boost beef production. A slower pace of slaughter in the third quarter and slightly lower
weights due to heat stress are expected to result in lower pork production compared to last month.
USDA will release its Quarterly Hogs and Pigs report on September 28, providing an estimate of sow
farrowings in June-August and an indication of producer intentions for farrowings into early 2012.
Broiler production is about unchanged as an increased forecast of third-quarter production is offset by
lower expected production in the fourth quarter. No change is made to turkey production and only a
slight revision is made to egg production. For 2012, the beef production forecast is raised but pork
and poultry production forecasts are reduced from last month. Larger forecast early year beef
production reflects marketing of the large number of calves which are being placed as a result of
drought in the Southern Plains. However, production in subsequent quarters will reflect tighter
supplies of cattle and lighter expected carcass weights due to the placement of lighter cattle and
relatively high feed prices. Pork forecasts are reduced as tight feed supplies dampen hog weights.
Poultry production forecasts are reduced as relatively high feed costs limit the sector’s expansion.
The egg production forecast is lowered due to lower hatching egg production.