DTN Livestock Analyst John Harrington said he believes 2016 exports will improve over their performance seen in 2015, especially beef. He said he looks for U.S. beef, pork and poultry exports to be up 9%, 5% and 9%, respectively.
The strengthening U.S. dollar could also affect exports in 2016, Harrington said.
"If the dollar continues to gain on foreign currency as it did through 2015, export demand could turn out to be softer than I currently imagine," he said. "That would be bad news for domestic price potential with U.S. consumers asked to eat even more meat."
There is much uncertainty about domestic beef demand, especially after wholesale prices imploded in the second half of 2015. Harrington said the big question will be which one was the aberration: the strong demand curve seen in the first half of 2015, or the weak demand curve seen in the second half of the year?
Assuming that foreign trade is generally more helpful during the year and feed costs remain relatively low, Harrington said he expects livestock feeding margins to generally improve, especially in the case of fed cattle.
While feedlot prices will probably average below 2015 (likely to range between a winter low near $125 and a spring/early summer high of $150), feeding profits stand to be much better thanks to lower breakevens. He added that it may also mean lower price expectations for ranchers.