Agribusiness Weekly Update: Demand for beef remains low

Beef
U.S. beef packers lost $108.39 per head processed, versus 47 cents pocketed a year ago. Cattle slaughter was down 9.8%, while beef production fell 6.5% from a year ago. The beef market usually begins a seasonal rally in April but the demand pick up has been slow to materialize this year. Undisciplined packers are bidding cattle at $122-$123 when fundamentals should put cattle at $108-$110. Beef exports in February were down 3% year over year as Mexico, Japan, South Korea and Canada are each importing less.

Hogs & Pork
Pork processors lost $1.97 cents per head last week, compared to $6.51 profited last year. Weekly hog slaughter numbers rose 0.8%, while pork production increased 1.4% compared to 2011. U.S. pork exports were up 9% in February when compared to the prior year.

Chicken
The chicken processing margin averaged zero cents per pound last week, 10 cents better than a year ago. Broiler egg sets were down 4.5% to 199.2 million eggs. Heads slaughtered declined 7.5% year over year, while pounds produced fell 6.8%. U.S. chicken exports in February increased 24% from a year ago. Breast meat prices were down 7 cents to $1.27 per pound compared to a year ago. Seasonally, breast pricing begins to climb post Easter through the summer grilling season. Leg quarters were 49 cent per pound, up 5 cents from 2011 levels.

Table Eggs
The egg margin averaged 42 cents per dozen, one cent below a year ago. Southeast egg prices were $1.12 per dozen, 13 cents below a year ago. .
     
Grains
Cash corn prices finished the week down 30 cents to $6.29 per bushel and 12.8% lower than a year ago. Soybean prices rose 2 cents to $14.19 per bushel, up 8.5%% from a year ago.
       
Dairy
The retail price for a gallon of milk was $3.50 in March, down 0.1% from last year and marked the first year-over-year decline since February 2010.

Ethanol & Energy
The ethanol crush margin averaged 36 cents per gallon, down 12 cents from last week and 1 cent above  last year. Ethanol averaged $2.22 per gallon, trading at a record $1.13 discount to gasoline.