01/22/09 Beef market thoughts 2009

Could U.S. beef supplies in 2009 mean better prices for producers? I'm Jeff Keane; I'll be right back to discuss that question. Could lower 2009 beef supplies in the nation help increase cattle prices for producers? John Otte writing in Western-Farmer Stockman magazine and using USDA projections feels the demand for beef has a chance to increase in 2009. The USDA predicts beef production will be about eight-tenths of a percent lower than 2008. Compared to 2008 the USDA thinks pork , broiler, and turkey production will all be down. This means less total U.S. meat supplies will be available for sale. Per capita beef supplies could be 1.1 percent less than 2008. The USDA actually predicts fed steer prices for 2009 between $93 to $100 per hundred weight compared to around $93 for 2008. This all sounds pretty good but Mr. Otte says consumers may move down the meat protein ladder and substitute pork for beef and poultry for pork. This would be a negative for beef of course, but consumers might also refrain from other major purchases and buy beef for home consumption. That would be good for beef. On the other hand if U.S. beef exports fall off because of a stronger American dollar then domestic beef supplies would be more plentiful. That could drop beef prices. That a lot of ifs, buts and maybes. I believe we are just going to have to wait to see how beef prices trend in 2009. I'm Jeff Keane. Western-Farmer Stockman January 2009.