The latest World Agricultural Supply and Demand Estimates report is projecting lower beef production over the next two years while poultry output continues to expand and milk production trends higher.
For 2026, USDA trimmed its beef production forecast after seeing a slower pace of fed cattle marketings. Fewer steers and heifers moving through feedlots are expected to outweigh an increase in cow slaughter. Lighter average carcass weights during the middle of the year also contributed to the smaller production estimate.
Pork production was also adjusted slightly lower. USDA pointed to fewer expected hogs available for harvest during the second half of the year following the latest Quarterly Hogs and Pigs report. While heavier carcass weights are expected, they are not enough to offset the decline in slaughter numbers.
The poultry sector continues to move in the opposite direction. Broiler production was increased as strong profit margins encourage producers to expand output. Turkey production also received a modest boost for 2026 based on recent processing data, while egg production estimates remained unchanged.
Looking ahead to 2027, USDA expects beef supplies to tighten further. Lower feedlot placements during 2026 are expected to result in fewer market-ready cattle next year, reducing steer and heifer slaughter. Pork production is also forecast to decline because of a smaller anticipated pig crop. Broiler production, however, is expected to continue growing as favorable economics support expansion.
On the trade front, USDA lowered its 2026 beef export forecast for the second quarter after weaker recent shipments but left the remainder of the outlook unchanged. Beef import projections were also reduced for the second quarter. Pork exports were lowered because of softer demand from several Western Hemisphere markets, while broiler exports were increased in the near term before being trimmed later in the year due to weaker overseas demand.
Livestock prices also saw adjustments. Strong cash cattle prices during June prompted USDA to raise its third quarter cattle price outlook for 2026, and slightly higher cattle prices are projected again in 2027 as beef supplies tighten. Hog price forecasts were lowered for the rest of 2026 following recent market weakness, while turkey prices were revised higher. Egg price expectations were eased slightly for late 2026.
The dairy outlook also shifted. USDA raised milk production forecasts for both 2026 and 2027 after increasing expectations for dairy cow numbers. Larger milk supplies are expected to pressure dairy markets, leading USDA to lower forecasts for cheese, butter and nonfat dry milk prices.
The agency now forecasts the average all milk price at $20.00 per hundredweight in 2026, with another slight decline to $19.85 per hundredweight in 2027. Even with lower prices, dairy exports are expected to improve as shipments of cheese, butter and whey products continue to strengthen.