A modest increase in meat inventories at the end of February indicates demand for protein is healthy, with boneless beef supplies seeing an especially notable drawdown due to reduced imports, analysts at the Daily Livestock Report said.
Inventories in USDA’s latest cold storage report increased 0.5 percent in February from January, compared with the average increase of about 3 percent for the month, they noted.
“Meat protein production continues to increase and the fact that inventories have not increased significantly implies that product is moving and demand is generally good, both in domestic and export channels,” the analysts wrote in the report, published by Steve Meyer & Len Steiner Inc.
Total supplies of beef, pork, chicken and turkey in cold storage at the end of February were 1.6 percent above a year ago, at 2.268 billion pounds.
Boneless beef dips
A decline in beef imports contributed to a significant drawdown in boneless beef stocks, the analysts said. Liquidation of frozen fat trim probably also helped reduce overall beef inventories, they said.
Boneless beef in cold storage at the end of February was 449.2 million pounds, down 0.3 percent from a year ago and down 6 percent from January. Typically, boneless beef inventories decline just 1 percent, the analysts said.
Pork also down
Total pork in cold storage was 628.4 million pounds, 8.6 percent lower than a year ago and 0.9 percent below the five-year average, according to the analysts. Weekly hog slaughter for December through February was estimated up 2.9 percent from a year ago, and pork production was estimated up 2.1 percent, yet inventories have been drifting lower, the analysts noted.
Pork trim inventories remain light, down 41 percent from a year ago and 31 percent below the five-year average, which should support the market in the spring when demand for hot dogs and sausages increases, they said. Ham inventories are far from burdensome at 115.8 million pounds, 9.3 below a year ago and 1.4 below the five-year average, they wrote.
Chicken piling up
Total chicken inventories at the end of February were 810.4 million pounds, 10.7 percent higher than a year ago and 22.7 percent higher than the five-year average, the analysts said.