The amount of meat in U. S. warehouses at the end of January was down from a year earlier due to better demand and larger exports, and that should support meat prices in 2010.
“Lower stocks across the board for all categories compared to last year shows that we are going to have a tighter supply situation and we should have higher prices continuing in 2010,” said Rich Nelson, livestock analyst with Allendale Inc.
Lower pork production, better domestic demand, and improvement in exports compared to last year reduced the pork supply.
The Feb. 22 U. S. Agriculture Department’s monthly meat supply report showed pork stocks at 495.61 million lbs., up 5.2 per cent from December, but down 18.4 per cent from 606.9 million lbs. a year ago.
“Between a drawdown in the (pork) bellies, loins, and ribs you had a smaller total pork than expected. You had a slight drawdown in the bellies, which is extremely rare,” said Dennis Smith, broker with Archer Financial.
Beef stocks were 432.8 million lbs., up 0.6 per cent from December but down 6.5 per cent from last year, while poultry stocks were down 19 per cent from last year.
Improvement in world economies likely increased domestic and export demand for pork, despite Russia, an important export market, banning pork from several U. S. plants.
Pork exports during December, the latest month reported by the USDA, were 363.7 million lbs., up from 312.2 million lbs. last year while beef exports were at 169.4 million, up from 135.5 million lbs. a year earlier.