4-29 IAT Cattle Outlook

 Ag Outlook Mixed for 2013

As we do every year, we are going to spend a few days listening to market reports from the best agricultural analyst that I know, Michael Stolp who is vice president of market research and development for Northwest Farm Credit Services. Today he talks about beef and dairy outlooks. So take it away Michael.

Beef -- Prices for most cow-calf producers remain above breakeven levels. Continued dry conditions have decreased pasture availability and increased pasture costs in many areas of the Northwest, which will pressure profit margins and limit herd expansion. Cattle supplies remain a bullish indicator for the industry. With shrinking cattle inventories and stable retail demand for beef, cattle prices are positioned for improvement in the latter part of 2013. Cow-calf producers are expected to remain profitable. The prospect of better fed cattle prices and lower corn costs this fall should create profit opportunities for cattle feeders. 

Dairy -- Northwest dairy producers’ first quarter financial results reveal varying profitability. Milk prices and high feed costs challenged the industry. Producers positioned for profitability remain opportunistic, carefully evaluating choices and industry changes. Returns are expected to improve throughout 2013. Average milk prices are forecast to increase, supported by strong export markets. Feed costs should decrease, driven by weakening corn prices.