Year-end Export Totals Show Positive Trends for Meats

February 18, 2010 06:00 PM Editors

U.S. red meat exports finished 2009 on a positive note with healthy gains in volume over December of a year ago, positioning both beef and pork exports to start 2010 on an upward trend, according to statistics compiled by the U.S. Meat Export Federation (USMEF).

Although 2009 year-end exports of both U.S. pork and beef were down compared to the prior year, U.S. exports equaled or bettered their main international competitors.

U.S. pork exports closed the year with an eight percent jump in volume and six percent in value for the month of December compared to year-ago totals. For the calendar year, pork exports registered the second-highest total in history, but fell nine percent in volume and 11 percent in value behind the record-setting totals of 2008.

However, U.S. pork exports still outpaced the performance of global competitors, which (based on available data) slumped 15% in value for the year, led by a 22% drop for European Union pork producers.

The story was similar for U.S. beef exports, which rose 9% in volume and four percent in value for the month of December compared to 2008. For all of 2009, global beef export value (estimated from available trade data) fell 16%, with Brazil's export value tumbling 23% and Australia's falling 18.5%.

U.S. beef exports for all of 2009 slipped nine percent in volume and 15% in value compared to 2008.

"It's been a challenging year for beef and pork producers around the globe, not just in the United States,” said Philip Seng, USMEF president and CEO. "However, it is encouraging to see consumer confidence returning and very positive signs of growth.”

Seng also noted that USMEF is committing significant resources to key export markets to continue the momentum. On the beef side, the USMEF "Trust” imaging campaign in South Korea has generated very positive results in what was the No. 3 U.S. beef export market prior to the discovery of BSE in 2003. The U.S. soybean industry has also provided a $1.35 million cash infusion to promote U.S. pork exports. USMEF is combining those funds with existing USDA Market Access Program (MAP) funds and new matching contributions from retailers to create more than $4 million in promotional impact for pork marketing programs in Japan, Mexico and South Korea.

Pork exports trail 2008, but still far surpass any previous year

For the entire year, U.S. export volume of 1.87 million metric tons (4.11 billion pounds) trailed the record pace of 2008 by 9%, while value ($4.33 billion) was down by 11%. A comparison to 2007, however, illustrates the degree to which U.S. exports have expanded in a two-year period: 2009 pork/pork variety meat exports exceeded 2007 levels by 43% in volume and 37% in value.

Mexico was the volume leader with 503,503 metric tons (1.11 billion pounds) valued at $762.35 million – an increase of 27% and 10%, respectively, over 2008. This record-breaking performance was particularly impressive considering the country's sluggish economy and a temporary midyear disruption in pork demand due to H1N1 influenza.

U.S. pork recorded another spectacular year in Japan, falling just short ($1.54 billion versus $1.545 billion) of the value record set in 2008. This was achieved despite an increase of about five percent in Japan's domestic pork production. The U.S. share of Japan's imported pork market also reached an all-time high of 46%.

In addition to Mexico, single-year pork/pork variety meat export records were established in the following markets:

Taiwan (up 35% in volume and 26% in value over 2008), the Philippines (up 44% in volume and 41% in value), Australia (up 10% in volume and 3% in value), New Zealand (up 11% in volume and 1% in value) and Central and South America (up 12% in volume and 14% in value). Exports to the Caribbean also set a record, increasing 18% in volume and 10% in value over 2008. This performance was led by a surge in pork shipments to the Dominican Republic (up 41% in volume and 32% in value), with the United States even surpassing the tariff rate quota and safeguards established in the CAFTA-DR free trade agreement.

The biggest declines in U.S. pork exports in 2009 came in two areas where market access and increases in domestic pork production were factors: China/Hong Kong and Russia. Exports to China/Hong Kong declined 35 percent in volume and 38 percent in value. Mainland China has been closed to U.S. pork since June 2009 due to H1N1 influenza. Exports to Russia fell 36% in volume and 39% in value. Other markets that showed a significant decline in 2009 included Vietnam, Singapore, South Korea and the European Union.

The U.S. did fill its pork tariff rate quota (TRQ) with Russia of 100,000 metric tons (220.5 million pounds), exporting 102,805 metric tons (226.6 million pounds) of muscle cuts. Exports within the TRQ face a 15% duty while over-quota exports face a 75% duty. For 2010, Russia has reduced the U.S. TRQ to 57,500 metric tons (126.8 million pounds), and the high over-quota duty is expected to limit U.S. pork exports.

Overall, pork and pork variety meat exports equated to 22.5% of U.S. production compared to 24.4% in 2008. The value of exports per head slaughtered was $38.44 compared to $42.31 in 2008.

Global pork export value for all major exporters was down in 2009 by about 15% (to $12.75 billion). This decline included Mexico (-29%), the European Union (-22%) Brazil (-17%), Canada (-11%), with China and Chile each down about 1%. The United States maintained a steady market share, accounting for about one-third of all global pork exports in 2009.

Beef exports gain momentum as global economy shows signs of improvement

For calendar year 2009, beef exports finished about 9% below 2008 in volume (897,376 metric tons or 1.98 billion pounds) and about 15% lower in value ($3.08 billion). When examined more closely, however, U.S. beef exports held up relatively well considering that the bleak global economy that prevailed throughout much of the year had a particularly strong impact on beef demand and may have benefited pork.

Much of the decline in beef exports is attributable to lower demand in Mexico, due to that country's deep recession and devaluation of the peso. Total beef/beef variety meat exports to Mexico declined 27% in volume (to 291,700 metric tons or 643.1 million pounds) and 35% in value (to $909 million). In fact, exports of HS chapter 0504 products (primarily tripe) to Mexico plunged 52% in volume and 64% in value. If these products are excluded from global totals, U.S. beef/beef variety meat exports declined by just 1.5% in volume and 8% in value compared to 2008.

U.S. beef also fared better than many of its global competitors in 2009. Brazilian beef exports declined 23% to $3.89 billion; Australia's export value dropped 18.5% to $3.76 billion and New Zealand fell 19% to $1.233 billion. Canada's exports declined at a slightly lower rate, but still fell 13% to $1.116 billion. Argentina was the only major exporter to record an increase in 2009 (to $1.8 billion). But while Argentina's export volume increased 56%, it achieved only a 6% increase in value. This is a strong indication that the increase in exports was largely driven by herd liquidation.

The most positive trend for U.S. beef exports in 2009 was the explosive growth achieved in Asian markets:

December exports to Japan were well above the previous year's level, capping off a year in which exports surged by 23% in both volume and value (to 91,467 metric tons or 201.6 million pounds valued at $470 million).

December exports to Taiwan increased 29% from 2008 and jumped 53% from November 2009 – suggesting a quick recovery from the widely publicized controversy over the new trade protocol adopted in October. For the year, export volume was steady at 27,256 metric tons (60.1 million pounds) but export value increased 11% to an all-time record of $141.2 million.

December exports to Vietnam were up 59% in volume and 47% in value over 2008. For the year, record-large exports to Vietnam increased by 31% in volume (to 53,675 metric tons or 118.33 million pounds) and 29% in value (to $168 million).

December exports to Hong Kong were up 124% in volume and 159% in value over year-ago levels. For the year, exports to Hong Kong increased by 145% in volume (to 24,060 metric tons or 53 million pounds) and by 104% in value (to $84.56 million).

Year-end exports to South Korea were down compared to 2008, but gained considerable strength as the year came to a close. December exports to Korea were $29.48 million – nearly double the value from December 2008. According to weekly export data, export volume to Korea exceeded 1,000 metric tons per week since late September and averaged about 1,240 metric tons per week since the beginning of 2010.

For the year, 10% of U.S. beef and beef variety meat production was exported compared to 11.6% in 2008. The value of exports per head of steer and heifer slaughter was $118.27 compared to $133.84 in 2008.

Strong year for lamb exports as muscle cuts set new value record

U.S. lamb muscle cut exports set a new value record of $21.9 million in 2009, breaking the previous year's mark by 2%. Muscle cut volume was 6,974 metric tons (15.38 million pounds), trailing only the 2006 record volume of 7,941 metric tons (17.51 million pounds).

Combined lamb plus lamb variety meat exports fell just short of the 2006 value record of $27.75 million, but the year-end total ($27.38 million) increased 8% over 2008. The year-end volume of 11,427 metric tons (25.19 million pounds) was 45% higher than 2008 and was also the second-highest total (to 2006) on record.

The Caribbean remained the leading value market for U.S. lamb, with a combined lamb/lamb variety meat total of $11.82 million. But exports to Mexico tripled in value over 2008, rising to $8.13 million.

Complete 2009 statistics for pork, beef and lamb exports are online.

Source: U.S. Meat Export Federation
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