Annual Animal Slaughtering and Processing has declined 1 percent over the past 12 months with additional decline likely through the end of 2014. Last year’s culling of the U.S. beef herd in the wake of the 2012 drought and the shrinkage of the pig herd in the face of the ongoing Porcine Epidemic Diarrhea virus have both meant less slaughtering production this year.
Corn and soybean harvests are projected to beat last year’s record harvest in the U.S. Along with smaller domestic herds, this is putting downward pressure on prices. Corn Futures Prices have fallen 12 percent on a year-over-year basis, down to $3.77 per bushel in October, the lowest price since June 2010. Soybeans Futures Prices are also on the decline, down 18.3 percent year-over-year to $10.47 per bushel at the end of October. Plummeting corn and bean prices will be advantageous for livestock producers going forward.
Jim Chappelow is an economist at ITR Economics. For more information, contact ITR Economics at (603) 796-2500, or visit www.itreconomics.com.
