REDFIELD, Iowa (DTN) -- Prices for beef and eggs are steady to increasing from the previous year due to small inventories and disease pressure. This shows a decrease in per capita consumption of the two, while pork and broiler consumption is projected to increase in 2025, according to the United States Department of Agriculture's (USDA) Livestock, Dairy and Poultry Outlook.

Russell Knight, USDA Agricultural Economist, said the small cattle herd size is expected to linger with the total of all cattle and calves on Jan. 1, 2025, estimated at 0.5 million fewer than the previous year at 86.662 million head.

"This marks the sixth year of contraction for aggregate beef and dairy cattle inventories and the 11th year overall of the current cattle cycle," he said in a report.

The cycle is influenced by the combined effects of cattle prices, input costs that drive cow-calf producer profitability, the gestation period for cattle, the time needed for raising calves to market weight, and climate conditions.

The number of beef cows on Jan. 1 declined 0.5% from last year to 27.864 million head. Retention of beef heifers in the herd declined 1% from last year also. The number of beef cows is down 39% from the historic peak set in 1975. Knight says the current inventory is the smallest beef cow herd since 1961.

The 2024 calf crop estimate is larger than expected, as the ratio of cales to cows is nearly 90%, which is the highest since 2004.

"Based on the number of cattle on feed and the number of calves, steers and other heifers on Jan. 1, it is estimated there are 24.557 million head of cattle outside of feedlots available for placement at the beginning of the year," he adds.

This number is only 114,000 head fewer than 2024, which is likely due to the ban on feeder cattle from Mexico because of the New World screwworm case in the country to the south. In the five years previous, an average of 134,000 head came across the border in the month of December from Mexico.

The feeder cattle supply outside of feedlots on Jan. 1, 2025, appears to be the lowest on record over the past 15 years. An increase could be seen as the border reopened in early February to cattle imports from Mexico once they go through the strict protocol. The handling of imports is expected to be slow at first, and it is unsure if weekly volumes will reach the 2024 levels. This has also led to the Mexican cattle crossing being larger than normal until inventories catch up.

Prior to the reopening of Mexican cattle imports, feeder steers weighing 750 to 800 pounds set a new monthly record at $274.45 per hundredweight (cwt), more than $48 above January 2024. These prices have since dropped after the border reopened. Knight said the price outlook for 2025 is $273.75 per cwt, which is an increase of about 9% from 2024.

Global demand for U.S. beef continues to be strong even with higher beef prices. The main customers of U.S. beef continue to be Japan, South Korea, China, Mexico, Canada and Taiwan.

PORK PRODUCTION INCREASES

The U.S. pork industry produced more pork in January 2025 than it did in 2024, according to USDA Agricultural Economist Mildred Haley. Federally inspected pork production was estimated at 2.5 billion pounds, which was about 1% higher than the previous year. This was the result of more animals being ready for slaughter along with higher average dressing weights.

Prices for hogs were higher in January at $80.19 per cwt, which was over 19% higher than January 2024. Strong consumer demand for pork in the food supply continues to be the driving force behind the higher prices.

"As producers anticipate a continuation of strong pork demand and relatively tight slaughter hog supplies, they have bid up prices of early weans and feeder pigs," she added.

Prices for early weaned pigs and 40-pound feeder pigs were significantly higher at the beginning of 2025, which suggests a good demand for slaughter hogs in the U.S. In January 2025, the average price for these small pigs was 50% to 96% higher than the same time in 2024.

In 2025, total pork production is forecast at 28.5 billion pounds, which is 2.7% higher than 2024. Hog prices are also expected to be 3.2% higher, averaging $63.50 per cwt.

POULTRY PRODUCTION AFFECTED BY HPAI

Broiler meat has been steadily increasing over the past several years, while turkey consumption has been declining. Table egg production faces disease pressure from highly pathogenic avian influenza (HPAI) and has dropped as well.

Broiler production was 1.3% higher in 2024 than 2023, but lower than the average growth of 1.9% for the 13 years previous, USDA Agricultural Economist Grace Grossen said in the report.

The projected 2025 first-quarter broiler production is expected to be down slightly due to HPAI in the first couple months of the year. The projected long-term production shows an increase in total production to remain at 47,625 million pounds.

According to USDA's Animal and Plant Health Inspection Service, January 2025 HPAI outbreaks resulted in the depopulation of more than 23 million birds in the U.S., which was up from 18 million the month before.

Egg production in December was down 3.7% from the previous year. The egg laying inventory on Jan. 1 was 304.3 million layers, the lowest inventory since August 2024. The lowest layer inventory since the current HPAI outbreak was 302.8 million in June 2022.

Turkey production is expected to decline due to disease pressure as well. Lamb and mutton production for 2025 is expected to increase slightly over 2024. The 2025 dairy herd is expected to be smaller than 2024, causing an increase in dairy product prices.

Jennifer Carrico can be reached at jennifer.carrico@dtn.com

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