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Beef, Sheep Industries to Face Another Poor Year

PULLMAN, Wash. — Livestock producers should find improved prices in 1999, but beef production still won’t be profitable for many cattlemen.

That is the assessment of Ray Folwell, Washington State University agricultural economist. It is contained in the 1999 Pacific Northwest Agricultural Situation and Outlook Report, released Wednesday (Dec. 30) by Washington State University, University of Idaho and Oregon State University economists.

Folwell said the 1998 U.S. calf crop is estimated at 37.9-million head, down 2 percent from 1997 and the smallest since 1951.

This suggests less production of beef in 1999, and thus, higher prices for the industry.

Producers currently are receiving $60-63 per hundredweight, on a live-weight basis. During the first quarter of 1999, Folwell believes prices could move up to $64-$66 per hundredweight. They could go as high as $70 if severe winter reduces the performance of cattle on feed and supplies tighten more than expected.

A hundredweight is one hundred pounds. Carcass basis is measured before meat is cut, boned and trimmed of fat.

Prices are being held down by continued declining consumption in the United States and by economic problems in Asia, especially in Japan and South Korea. Mexico, however, is a bright spot in the export market with increased purchases.

Folwell said per capita beef consumption in the United States is estimated at 96.6 pounds for 1998, and is expected to drop to 92 pounds in 1999.

The Northwest sheep and lamb industry continues to decline, parallel to the U.S. industry. Wool prices are expected to remain about the same. U.S. wool production is expected to be at a record low.

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