Livestock Marketing Information Center

Current Situation and Analysis
Last Updated: 1/11/2017
CHEESE CONSUMPTION GROWTH PUSHES MILK PRICES HIGHER

A lapse in U.S. cheese consumption increases during the first half of this year had a serious impact on milk prices and dairy industry profitability. Consumer demand for cheese during the first half of the year normally holds steady at levels seen at the end of the prior year and then improves in the second half of the year. American-type cheese consumption declines during the first half but is offset by increased consumption of Italian-type cheeses. During the first half of 2016, even Italian-type cheese consumption declined.


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HOG/PORK MARKETS: IMPORTANT DEVELOPMENTS DURING LATE 2016

In the hog/pork markets, three key items during the fourth quarter of 2016 are well worth reviewing. First, the Quarterly Hogs and Pigs report from USDA’s National Agricultural Statistics Service (NASS) showed 2% more market hogs than anticipated. That will translate into larger hog slaughter than earlier forecast well into 2017. Further, the overall breeding herd as of December 1, 2016 was a bit larger than anticipated. Regarding prices, on the positive side were recent trends in both frozen pork stocks and export trends.


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U.S. FROZEN LAMB AND MUTTON STOCKS DECLINE

Huge frozen stocks of lamb and mutton overhung the U.S. market since the summer of 2014. To put those stocks in context, consistently beginning in 2014 the frozen tonnage exceeded one full quarter’s worth of U.S. commercial production. But, that picture has changed, finally. Frozen tonnage in commercial facilities is provided monthly in the NASS Cold Storage report, the latest data were as of the end of November 2016. NASS does not break-out the source or type of lamb and mutton, but indications were that much of the huge stockpile was imported product.


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