USDA lowers beef production and cattle price forecasts

The latest United States Department of Agriculture’s (USDA) World Agricultural Supply and Demand Estimates (WASDE) report brought a few notable changes for the cattle sector, including lower beef production forecasts and reduced cattle price expectations.

Ahead of the report, much of the focus was on whether USDA would lower its corn yield estimate. The revised yield forecast came in close to what analysts had been expecting.

For the cattle sector, USDA lowered its 2026 beef production forecast, citing a slower pace of fed cattle marketings, lighter dressed weights, and lower cow slaughter later in the year.

The 2027 forecast was also revised lower. USDA attributed the change to lighter dressed weights and lower-than-expected feedlot placements during the first half of the year.

Even with lower projected beef production, USDA reduced cattle price forecasts for the third and fourth quarters of 2026, citing lower-than-expected packer demand. The lower forecast was carried forward into 2027.

USDA also raised beef export forecasts slightly for both 2026 and 2027, pointing to stronger shipments to Asian markets. Beef imports for 2026 were increased on expectations for stronger shipments from South America, while the 2027 forecast remained unchanged.

Feed grain outlook

On the crop side, USDA lowered its U.S. corn production forecast for 2026/27 due to reduced yield expectations and increased its season-average corn price forecast by $0.30 per bushel to $4.80.

While corn attracted much of the attention heading into the report, the revised yield estimates came in near pre-report trade expectations.

Globally, production estimates moved higher for several feed grains. Canada’s wheat production forecast was raised to 36 million tonnes, while Australia’s barley crop was increased to a record 17.1 million tonnes.

USDA also increased its forecast for global wheat feed use, led by Australia, with smaller increases in Kazakhstan and Ukraine.