Global beef forecast for the remainder of 2022
The first half of global beef production and sales of 2022 is in the book. The general direction of beef and beef market forecasts for this year has not changed, but full-year forecasts have changed by the first half of the year.
There will be very different impacts in the second half of this year. If the forecast is correct, some factors in the third and fourth quarters will be significantly different from the first half. Beef production is expected to decline year-on-year in 2022 from last year’s record level.
The magnitude of this decline is lower than previously predicted, with current estimates that beef production in 2022 will decline by about 1 percent. Production of beef in the first half of 2022 increased by about 1%. In other words, production is expected to decline even more sharply in the second half of the year, and in the rest of the year it is expected to decline by nearly 4% year-on-year.
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Global beef reduction
A reduction in future beef production means a reduction in cattle slaughter. Beef slaughter is currently projected to decrease by 1.0% annually. Total slaughter in the first half of this year increased by 1.4% compared to the previous year. This increase may be due to increased slaughter of females, with total slaughter of cattle and heifers increasing by 4.5% in the first half of this year. So far, the increase in female slaughter has more than offset the annual decrease of 1.6% in steer and bull slaughter. The total number of cattle slaughtered so far this year has increased by 6.1%, dairy cattle slaughter decreased by 3.1% year-on-year, and partly due to the year-on-year increase of 14.6%.
For the rest of the year, cattle slaughter totals remain double orders of magnitude higher than last year, and cattle slaughter totals could increase by 5-6 percent year-on-year. This means that slaughter of cattle can be reduced by slaughtering fewer and heifers.
At feedlots, there was a record cattle inventory on June 1 feed. This seems incompatible with the idea of marketing cuts in the coming months. However, the feedlot raised more light cattle, which increased the number of days of feed and reduced turnover. In other words, the marketing rate has dropped. The feedlot will process the current inventory later this year.
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Global beef affected by drought, energy increased feed costs
The May ranking fell due to the largest monthly year-on-year decline since September last year. Unless the drought pushes more cows into the fattening herd, less placement in the coming months will result in fewer fattening herds until the end of the year.
Exactly how continuing drought, reduced forage production and high feed prices will impact cattle and beef markets in the coming months remains uncertain. Nevertheless, the second half of 2022 is shaping up to look significantly different than the first half of the year.
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Source: Beef Mag
