Animal Production

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 1,000,000 animal production operations in the US include farms that raise livestock (such as beef cattle, poultry, sheep, and hogs); farms that employ animals to produce products (such as dairies, egg farms, and apiaries); and animal specialty farms (such as aquaculture (fish farms)).

Environmental Impacts Drive Regulation

Livestock production introduces a number of risks to the environment that, if not properly managed, can impact human health.

Diets & Red Meat Consumption

Red meat’s portion of the American diet has fluctuated over time.

Industry size & Structure

The over 1 million livestock operations in the US include 711,800 cattle operations, 64,800 hog and pig farms, and 164,000 poultry and egg farms.

    • Livestock farms produce about $177 billion in average annual value on over 478 million acres. The average livestock operation generates about $164,000 in annual revenue.
    • The US Census Bureau defines a farm as an operation that produces or should have reasonably produced over $1,000 in revenue during a given year, including government payments.
    • About 90% of livestock farms are owned by farm families in which the family owns and/or operates the farm and has done so for generations.
    • More than 225,900 people are hired employees in the livestock industry, but 77% of total livestock labor is family members.
    • Farm operations that generate more than $1 million in revenue account for 79% of livestock production value.
                                Industry Forecast
                                Animal Production Industry Growth
                                Source: Vertical IQ and Inforum

                                Recent Developments

                                Oct 23, 2023 - Lower Prices for Livestock
                                • Prices received by farmers for livestock products declined in June compared to a year ago but ticked up slightly versus May. According to the USDA’s latest Livestock, Dairy, and Poultry Outlook released in October, cattle price forecasts for 2023 and 2024 are lower on recent price data and lower packer margins. Hog prices will likely average about $60 per hundredweight (cwt) this year on a total pork production increase of about 1.1%. In 2024, hog prices are forecast to average about $61 per cwt on a total pork production increase of 2.2%. Sales for the US animal production operations industry are forecast to grow at a 3.0% compounded annual rate from 2022 to 2027, slower than the growth of the overall economy.
                                • Plant-based meat alternatives are facing a steep decline in sales, Pork Business reports. Sales of meat alternatives have fallen steadily since 2021 and more sharply over the last year. Volume sales dropped 20.9% for the 52 weeks ending July 2, 2023, according to consumer behavior research firm Circana. High prices for plant-based meat products are a major factor in the decline. "The price of plant-based meats is often several dollars a pound higher than for equivalent meat and poultry products,” according to a new report from CoBank's Knowledge Exchange. “Beyond cost, lingering negative perceptions surrounding taste, value, and versatility are also obstacles the category has yet to overcome." Plant-based meat sales peaked in 2020. However, fewer than half of Americans who tried the products at the time, repeated their purchase, according to data from consumer research firm Mintel.
                                • Falling milk prices and rising input costs have caused dairy farmers’ earnings to plummet in recent months, with more dairies struggling to stay in business and some even closing for good, Focus on Agriculture (FoA) reported in August. “This is a real downturn,” California dairy farmer Jack Hamm told FoA. “These last two months have been every bit as bad as 2009,” he said, referring to the Great Recession that drove many dairy farms into bankruptcy. While milk prices were lower in 2009 than today, Hamm noted that overall production costs were “so much lower” back then. In addition to higher feed costs, farmers are paying more for labor, fuel, and fertilizer. Rising input costs come at a time when dairy economists and analysts say milk prices have plunged due to the slowing economy and higher food prices softening demand for milk and dairy products.
                                • The pork industry will have more time to comply with California’s Proposition 12, Meat+Poultry reports. Originally scheduled to start on July 1, Prop 12, which bans the sale of pork in California from farms anywhere in the US that confine pregnant pigs in “gestation crates,” the deadline has been pushed back six months to allow pig farmers more time to determine how to handle implementation of the new law. “Granting six months of additional relief for products in the supply chain allows grocery stores to remain stocked so the 40 million Californians have uninterrupted access to affordable, safe, and nutritious pork products, especially with rising food prices,” said Bryan Humphreys, CEO of the National Pork Producers Council. In May, the US Supreme Court ruled against the NPPC and the American Farm Bureau Federation, which challenged the measure. Prop 12 also applies to producers of veal calves.
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