As noted by most of the top 10 major producing nations, beef and veal producers globally are expected to benefit from cheaper feed supplies and rising import demand (mostly from China and Hong Kong). However, beef production in the U.S. is forecast to drop 6 percent because cattle inventories continue to shrink.

Global beef consumption is forecast slightly above last year’s record, at 57.0 million tons, while international trade is expected to continue reaching new records. Exports are forecast at 9.2 million tons, expanding 24 percent in just five years, with Brazil and India accounting for most of that growth.

Although the U.S. is still the world’s largest beef producer, production is forecast to plunge 6 percent to 11.0 million tons. Declining cattle inventories, spurred by lower calf crops in recent years and fewer live cattle imports, have resulted in tight supplies available for slaughter.

Furthermore, 2014 does not bode well for short-term recovery as heifer retention may further limit supplies of slaughter cattle. Consumption is forecast down 5 percent to 11.0 million tons.

The U.S. is expected to remain a net beef exporter with exports forecast down 6 percent to one million tons and imports virtually unchanged at one million tons.

Exports are constrained by tight domestic supplies and less competitive prices while import growth is limited by tight supplies from major suppliers (Canada, Australia and New Zealand).

Brazil
Brazilian beef production is forecast up 3 percent at a record 9.9 million tons, driven by an expanding herd, which is aided by government programs subsidizing interest rates to encourage pasture improvements and the use of higher-quality genetics.

Also contributing to larger beef supplies is an increase in feedlots. Higher cattle prices and moderating feed prices are expected to encourage producers to use more feed and other ingredients during the dry season to maintain weights.

Consumption continues to modestly expand, reportedly constrained by inflation and rising consumer debt. Exports are forecast nearly 8 percent higher at more than 1.9 million tons, mostly driven by increased competitiveness from the depreciation of the real.

European Union
Beef production across the EU is forecast to rise slightly to 7.8 million tons as relatively low feed prices and high beef and milk prices support herd expansion and increased supplies of slaughter cattle.

Beef consumption remains stagnant at just over 7.8 million tons.

The additional domestic production is expected to be exported, with volumes projected nearly 4 percent higher to 270,000 tons. Imports are unchanged at 350,000 tons.

China
Chinese beef production is forecast up 2 percent at nearly 5.8 million tons on increased slaughter and higher cattle weights due to stronger demand.

High profit margins are attracting large investments from cattle and beef companies, while backyard producers continue to exit the industry because of lower efficiency and limited investment.

Consumption is expected to continue outpacing production, with the recent surge in demand attributed to food safety incidents in other meat products (poultry and pork), which encouraged an increase in beef consumption.

Imports are forecast at a record 475,000 tons, up 19 percent due to increased demand, favorable import prices and high domestic prices. Along with Hong Kong, Chinese imports account for two-thirds of world import growth.

India
Strong demand for dairy products in India will encourage continued expansion in the bovine herd, as higher dairy prices spur the development of more commercial farms.

As a result, the herd is forecast to grow 1 percent to almost 330 million head. While a larger herd supports an increase in beef production (5 percent to a record of nearly 4.0 million tons), government programs also encourage production.

For instance, “The Salvaging and Rearing of Male Buffalo Calves Scheme” and “The Utilization of Fallen Animals” improved carcass utilization. Both these programs were incorporated in the government’s 11th Five Year Plan (2007-2012) and will also be in included in the 12th Five Year Plan (2012-2017).

Beef exports are forecast 6 percent higher at a record of nearly 1.8 million tons, accounting for about 20 percent of world trade.

Supplying lower-quality, price-competitive Halal meat are comparative advantages to expanding export sales to key Southeast Asian, African and Middle Eastern markets.

However, lack of a foot-and-mouth disease (FMD) status classification with the OIE (World Organization for Animal Health) continues to constrain India’s access to new markets.

Argentina
Argentine production is forecast up slightly at over 2.8 million tons with increasing cattle herds supporting ample supplies for slaughter.

Higher cattle prices are expected to improve returns that could help offset expected inflation. Government policies and market dynamics have contributed to falling carcass weights, which could limit the growth in production.

Exports are forecast up 22 percent at 220,000 tons on steady foreign demand and a devaluing peso. Increased demand from China and Hong Kong also supports expansion.

Australia
Beef production in Australia is forecast virtually unchanged at nearly 2.3 million tons. Exports are forecast up slightly at a record 1.5 million tons, supported by increased global demand for beef. However, tight supplies will limit export growth.

Mexico
Mexican beef production is marginally higher at nearly 1.8 million tons as feeding practices and genetic improvements are slowly improving weight gains and carcass yields.

However, drought conditions have resulted in reduced herds, and supplies of slaughter cattle are expected to be tight. Exports are forecast to rise 7 percent to a record 220,000 tons.

The improved quality, safety and sophistication of beef operations have opened doors for increased exports over the past few years.

However, the loss of the Russian market (based on concerns of ractopamine use) is a setback, although the industry is cultivating other markets. Imports are forecast up 4 percent to 235,000 tons.

Russia
Beef production in Russia forecast down modestly to just under 1.4 million tons on declining inventories, calf crops and slaughter, despite federal and regional government support programs to stimulate livestock development.

Consumption is expected to remain at 2.4 million tons. Imports are forecast slightly higher at just over one million tons as traders are expected to better utilize available tariff rate quota (TRQ) volumes, and certain neighboring countries (such as Belarus) are able to export duty-free beef to Russia.

Canada
Canadian beef production is forecast to remain near one million tons as cattle slaughter and carcass weights are not expected to change significantly.

Supplies of slaughter cattle remain relatively tight, reflecting declines in calf production. Exports are expected to rise slightly to 325,000 tons, after decreasing the four previous years. Imports are forecast 2 percent lower at 315,000 tons. 

Clint Peck is former director of Montana’s Beef Quality Assurance program.