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Monthly cattle report shows tightening supply

U.S. feedlots placed 4.9 percent fewer cattle in April compared to a year earlier, a report showed last week.

Cattle and calves on feed for slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 10.6 million head on May 1, the U.S. Department of Agriculture (USDA) said last week in a report. The U.S. inventory was 1 percent below May 1, 2013.

There were 660,000 head on feed for slaughter market in Iowa feedlots with a capacity of 1,000 head or more, the report said. This was up from 620,000 on May 1, 2013, the report said.

Placements in U.S. feedlots during April totaled 1.64 million, 5 percent below 2013.

There were 69,000 head placed in Iowa feedlots with a capacity of 1,000 head or more. This was down from 89,000 during April 2013, the report said.

Marketings of U.S. fed cattle during April totaled 1.78 million, 2 percent below 2013. Marketings for April are the lowest for the month since the series began in 1996, the report said.

There were 76,000 head of cattle marketed from Iowa feedlots with a capacity of 1,000 or more head during April 2014. This was down from 97,000 marketed during April 2013.

Addressing dairy barriers

A bipartisan group of 177 members of the U.S. House of Representatives last week urged the Obama administration to use the transatlantic trade talks with the European Union (EU) to ad­­dress a variety of export barriers hampering the U.S. dairy industry.

Among the barriers are the EU’s recent efforts to prevent U.S. companies from using common food names like parmesan and feta in export markets, including the EU, and even in the U.S. domestic market.

The Congressional Dairy Farmer Caucus, led by Reps. Reid Ribble and Peter Welch, spearheaded the letter to U.S. Trade Representative Michael Froman and Agriculture Secretary Tom Vilsack. In that message House members said negotiations with the European Union over the proposed Transatlantic Trade and Investment Partnership (T-TIP) offer a good opportunity to address protectionist measures that block U.S. dairy sales to 500 million consumers.

"We urge you to achieve a strong and beneficial outcome for the U.S. dairy industry in these trade negotiations," the letter said.

Dairy exports surge

The value of U.S. dairy exports in March topped $700 million for the first time, the U.S. Dairy Export Council reports. Exports of cheese, whey proteins, lactose and milk protein concentrate all reached new highs, while butterfat exports were the highest in more than 20 years and nonfat dry milk/skim milk powder rebounded from the level of the previous four months.

U.S. suppliers shipped 201,380 tons of milk powders, cheese, butterfat, whey and lactose in March, up 33 percent from last year. Total value of all exports was $717.0 million, up 46 percent.

Exports to China nearly tripled in March, to $91 million. Shipments to Mexico were up 60 percent. Exports were also up 43 percent to Southeast Asia and up 33 percent to the Middle East/North Africa.

China corn demand

China’s corn demand will increase 41 percent by 2023-24, according to a new report from the USDA’s Economic Research Service. Department economists say while China, the world’s No. 2 producer, will increase corn production because of acreage and yield increases, its consumption will increase at an even faster clip.

The country will need to import 866 million bushels, nearly half of this year’s estimated U.S. corn exports of 1.9 billion bushels.

From 2010-12, the U.S. ac­­counted for 97 percent of China’s corn imports, and it will remain a key supplier, ERS economists say. Other countries including Ukraine, Argentina and Brazil will likely push to expand sales to China as well.

Ethanol opportunities

Representatives from the U.S. Grains Council (USGC) were a part of a ethanol team that visited China earlier this month. "China is clearly a potential market for U.S. ethanol," said Bryan Lohmar, USGC director for China. "Policy makers in China are committed to improving air and water quality as well as reducing public health hazards. Based on these criteria, ethanol as an oxygenate additive in transportation fuel has superior qualities compared to the additives currently being used in China."

China has put a moratorium on producing additional ethanol from grain, and capacity to meet potential demand with domestic ethanol is limited, increasing import potential.