1. Livestock and meat industry
Per capita consumption
Demand measures
Trends
Industry segments and structure
Think of implication for supply and demand??????

2. Livestock & Poultry Markets 2009
Billion Per Cap Price Exp Imp
lbs1 lbs2 $/cwt %3 %3
Broilers
Beef
Pork
Turkeys
Lamb
Production of carcass weight meat measured at the packing plant. Consumption is estimated as a residual and divided by population. Price is the annual average farm level price. Export % are measured as the pounds exported as a percent of total production.
1/ Billion pounds of US production
2/ Pounds consumed per person per year
3/ As a percent of production

3. Livestock Marketing Information Center3

4. Measuring consumption
Balance sheet approach
Beginning inventories
+ Production
+ Imports
- Exports
- Ending inventory
= Disappearance
Per Capita consumption = Disappearance Population
A measure of supply rather than demand
Because we do not weigh each serving we put on our plate, we have to have another method to estimate consumption. The balance sheet approach based on factors USDA does measure estimates the amount of meat that disappeared during the year.

5. Livestock Marketing Information Center

7. Meat exports have also increased over time
Meat exports have also increased over time. Beef exports dropped dramatically in 2004 due to finding a cow with BSE in the US and most countries ban US beef. Chicken is not only the meat with the largest consumption in the US it is also the meat with the largest exports on a tonnage basis. Chicken exports have been more than pork and beef exports combined since 1994.

8. The US is a net importer of beef on a tonnage basis
The US is a net importer of beef on a tonnage basis. Imports exceed Exports every year. When the estimated beef from cattle imported to the US from Mexico (feeder cattle) and Canada (slaughter and feeder cattle) are included the amount of beef that was from cattle born in another country is approximately double that of US beef exports. On a dollar basis, the US export3 more dollars of beef and beef products than it imports (excluding cattle imports) through The reason for this difference is that the US exports higher value beef (for example Choice steaks) and imports lower value beef (lean grinding meat for burgers). We also count hides in the value but not the weight and we export over 60% of US hides. The first case of BSE was found in the US December 23, 2003 and exports dropped in 2004 and are slowly rebuilding.

11. US pork exports have grown steadily and dramatically over the last 18 years from near zero in 1987 to over 3 billion pounds in Pork imports have been relative flat over that time, but the importation of hogs from Canada has increased the amount of pork from hogs born outside the US. The growth in hog imports from Canada has been primarily feeder pigs and weaned pigs that are finished in the US (most often Iowa) and slaughtered in the US.

18. Meat production (or supply) is made up of two components: number of head slaughtered and weight of the carcass. Carcass weights of cattle and hogs have increased due to genetics with larger body size and leaner. To reach the same end point for fat-to-lean ratio that the market wants the animal is larger.
In the case of cattle growth promoting implants cause the animal to deposit more lean relative to fat and thus postpone the marketing date and weight when the animal is at the preferred quality grade.

19. Livestock Marketing Information Center
Data Source: USDA/NASS 19

20. Livestock Marketing Information Center20

21. US Beef Cattle Sector Packers: 33.7 million slaughter and 4 = 73%
Feedlots: 26.2 million marketings, 260 = 60%
Backgrounders
Beef Cows: 32.5 million cows in 758,000 herds

23. One time capacity

24. Estimated Beef Packer Capacity
Rank
Company
Head/Day
Share 1
Cargill Meat Solutions
29,000
21.2% 2
Tyson Foods
28,700
21.0% 3
JBS Swift
28,600
20.9% 4
National Beef Packing
14,000
10.2% 5
American Foods Group
7,000
4.7% 6
Greater Omaha Packing
2,900
2.0% 7
Nebraska Beef
2,600
1.9%
8-13
10,100
7.4%
Smaller
14,605
10.7%
Total
136,855
Source: CME DLR

25. US Hog Operations and Inventory by Size Based on Ownership of Hogs, 2007
Hogs/Operation
<500
48,760
2,727,080 56
2,840
2,181,664
768
1,860
3,272,496
1,759
1,600
6,135,930
3,835
670
5,454,160
8,141
340
16,042
150
40,906
50000+
120
36,815,580
306,797

26. Commercial Hog Slaughter Companies
Company
2002
2003
2004
2005
2006
2007
2008
Smithfield
19.9
22.5
26.1
25.1
26.5
28.4
28.3
Tyson
18.0
18.5
17.9
17.4
17.6
JBS USA
10.7
11.5
10.8
10.9
11.1
Cargill
8.5
9.2
8.9
9.0
8.7
Hormel
7.0
6.9
8.4
8.2
TOP 5
64.1
68.1
71.3
69.8
71.9
74.3
73.4

27. Hog or meat market formula 44.2 47.2 54 44.5 41.4 39.9 41.8 38.3 37.1
Percent of U.S. Hogs Sold Through Various Pricing Arrangements, January *
Year 99 00 01 02 03 04 05 06 07 08 09
Hog or meat market formula
44.2
47.2 54
44.5
41.4
39.9
41.8
38.3
37.1
41.2
Other market formula
3.4
8.5
5.7
11.8
7.2
10.3
8.8
11.0
7.9
Other purchase arrangement
14.4
16.9
22.8
8.6
19.2
20.6
15.4
16.6
15.2
13.4
11.6
Packer-sold
2.1
2.2
2.4
2.6
6.7
6.1
5.6
Packer-owned
16.4
18.1
17.1
21.4 20
22.7
23.1
25.7
Negotiated - spot
35.8
17.3
16.7
13.5
10.6
10.2
9.2
8.1
Source; Grimes and Plain, University of Missouri

28. 8
3715 68 40
1347
133
295
673

29. Top 10 Milk Cooperatives, 2008

30. Million