Beef Exports Remain Red Hot in July- Japan Remains Top Performing Market Thus Far in 2017Tue, 12 Sep 2017 05:46:04 CDT
U.S. beef exports remained well above last year’s pace in July, posting one of the highest monthly export value totals on record, according to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF). July pork export volume dipped below its year-ago level for the first time in 15 months, with export value also down slightly.
July beef exports totaled 104,488 metric tons (mt), up 5 percent year-over-year, while export value reached $623.7 million – up 18 percent from a year ago and the highest since December 2014. For January through July, exports increased 11 percent in volume (711,364 mt) and 15 percent in value ($3.97 billion) compared to the first seven months of last year.
Exports accounted for 13.2 percent of total U.S. beef production in July and 10.7 percent for muscle cuts only. These were the highest ratios of 2017, but down from 14.2 percent and 11 percent, respectively, last July. For January through July, beef exports accounted for 12.8 percent of total production and 10 percent for muscle cuts – roughly steady with last year. Export value per head of fed slaughter averaged $299.21 in July, up more than $35 (or 13 percent) from a year ago. Through July, per-head export value was up 9 percent to $273.52.
Pork exports totaled 173,675 mt in July, down 4 percent year-over-year, valued at $488.9 million, down 0.6 percent. January-July volume was still up 11 percent from a year ago to 1.43 million mt, while export value was up 13 percent to $3.7 billion.
Exports accounted for 26 percent of total pork production in July (down from 27.5 percent a year ago) and 21 percent for muscle cuts only (down from 23 percent). For the first seven months of the year, with U.S. production at a record pace, the percentage of total production exported increased from 25.6 percent to 27.5 percent. For muscle cuts only, the increase was from 21.6 percent to 23 percent. Export value per head slaughtered in July was $54.22 – up slightly from June but 3 percent below last July. The January-July per-head average increased 10 percent from a year ago to $54.11.
“July was certainly a solid month, especially for beef exports, but these results remind us that the U.S. red meat industry operates in an intensely competitive global environment,” said USMEF CEO Philip Seng. “At a time when some of our most essential trade agreements are under review, we must be mindful of how these agreements have helped make U.S. beef, pork and lamb more readily available and more affordable for millions of global customers, to the benefit of U.S. producers and everyone in the U.S. supply chain.”
Beef export volume to Japan largest in four years; value highest of post-BSE era
Beef exports to leading market Japan totaled 27,689 mt in July, up 20 percent from a year ago and the largest since July 2013 – which was shortly after Japan increased the eligible U.S. cattle age to 30 months. July export value to Japan increased 36 percent to $175.7 million, the highest monthly total since 1996. For January through July, exports to Japan were up 23 percent in volume (178,501 mt) and 29 percent in value ($1.08 billion). USMEF’s featuring of chilled beef in Japan continues to pay dividends as chilled exports were up 39 percent to 83,951 mt valued at $613 million (up 40 percent). Driven by strong growth in Japan’s foodservice industry, especially the gyudon beef bowl chains which heavily rely on U.S. short plate, U.S. frozen beef exports to Japan were up 12 percent to 64,928 mt (valued at $250 million, up 18 percent). But Japan’s frozen beef safeguard was triggered in late July, increasing the duty on frozen beef imports from suppliers without a trade agreement with Japan, including the U.S., from 38.5 percent to 50 percent. The impact of the safeguard is not likely to surface until the September export data is available. But since August, U.S. frozen beef has been at an even larger tariff disadvantage compared to Australian beef, which is subject to a duty rate of 27.2 percent under the Japan-Australia Economic Partnership Agreement.
Beef exports to South Korea dipped below the large volume of last July to 15,587 mt (down 5 percent), but were still the largest of 2017. July export value to Korea increased 8 percent from a year ago to $101.7 million. Through July, exports to Korea increased 9 percent in volume (98,944 mt) and 19 percent in value ($629.4 million), including an impressive 83 percent increase in chilled beef exports (22,432 mt) valued at $199 million (up 88 percent). The U.S. is now the largest supplier of beef to both Japan and Korea on a value basis, with the U.S. share of Korea’s imports increasing from 43 percent to 48.5 percent.
Other January-July highlights for U.S. beef exports included:
After a slow start in 2017, beef exports to Hong Kong continue to rebound. Exports were up 13 percent year-over-year in volume (65,379 mt) and 21 percent higher in value ($417.8 million). July was the first full month for exports to China, as exports totaled 137 mt valued at $1.3 million.
Beef exports to Taiwan increased 16 percent from a year ago in volume (24,234 mt) and 24 percent in value ($215.5 million), including chilled beef exports of 9,883 mt (up 19 percent) valued at $114 million (up 22 percent). U.S. beef holds more than 70 percent of Taiwan’s chilled beef market, the highest share of any Asian destination.
Led by strong growth in Chile, Peru and Colombia, beef exports to South America increased 20 percent year-over-year in volume (16,159 mt) and 21 percent in value ($63.2 million). Exports to Brazil, which launched in late April, reached 1,198 mt valued at $3.2 million.
A strong performance in the Philippines, Indonesia and Vietnam fueled 79 percent year-over-year growth in export volume to the ASEAN region (23,376 mt), with value up 59 percent to $114.1 million. This region is especially strong for beef variety meat exports, as volume reached 7,145 mt (up 176 percent) valued at $12.5 million (up 164 percent).
Within North America, beef exports were fairly steady with last year as Mexico continues to be the second-largest volume destination for U.S. beef exports while Canada ranks fourth. Exports to Mexico increased 2 percent in volume (134,543 mt) but slipped 2 percent in value ($544.8). Exports to Canada were up 1 percent in volume (68,097 mt) and 4 percent in value ($475.7 million).
July pork exports slip despite powerful growth in Mexico, Korea, South America
Pork exports to Mexico remained on pace for a sixth consecutive annual volume record, with July volume up 7 percent from a year ago to 58,625 mt and value increasing 9 percent to $122.9 million. Through July, exports increased 20 percent in volume (457,190 mt) and 26 percent in value ($854.4 million). Both the U.S. and domestic pork industries continue to reap the benefits of Mexico’s rapidly growing per capita pork consumption, which has increased by about one-third over the past 10 years to 18 kilograms annually (based on USDA estimates).
Leading pork value market Japan saw a year-over-year decline in July, as exports dipped 7 percent in both volume (28,314 mt) and value ($120.5 million). Through July, exports to Japan remained modestly higher year-over-year in both volume (228,489 mt, up 2 percent) and value ($931.1 million, up 6 percent). This included chilled pork exports of 122,755 mt (down 3 percent) valued at $577 million (up 3 percent), as Canada continues to compete strongly for Japan’s high-value chilled pork market.
Other January-July highlights for U.S. pork exports included:
In South Korea, pork exports continued to capitalize on strong red meat consumption growth, especially for convenience products and home meal replacement items, as exports to Korea climbed 30 percent in volume (103,142 mt) and 36 percent in value ($282.6 million).
Led by strong growth in Colombia and Chile, pork exports to South America more than doubled year-over year in both volume (56,345, up 104 percent) and value ($143.6 million, up 109 percent). The White House recently announced that Argentina will soon open to U.S. pork, adding further opportunities in this growing region.
Led by Honduras, exports to Central America are on a record pace, reaching 38,720 mt, up 6 percent from a year ago, valued at $92.4 million (up 8 percent). 2017 is also shaping up as a record year for pork exports to the Dominican Republic, where exports totaled 21,278 mt (up 42 percent) valued at $47.8 million (up 49 percent).
Strong growth in the Philippines fueled a 24 percent increase (to 26,710 mt) in pork exports to the ASEAN region, valued at $68.8 million (up 34 percent). Exports also increased to Singapore and were steady to Vietnam.
In the China/Hong Kong region, July exports dropped significantly from a year ago to 32,167 mt (down 33 percent) valued at $68.8 million (down 27 percent). July variety meat exports were the smallest in 18 months at 22,960 mt (down 10 percent). As China’s domestic pork production continues to rebound in 2017, January-July exports to the region were 8 percent below last year’s pace in volume (306,404 mt) but slipped just 1 percent in value ($627.1 million).
Lamb exports lose momentum in July
U.S. lamb export volume in July was below last year’s level at 593 mt (down 13 percent) while value was fairly steady at $1.48 million. Through July, lamb exports were down 13 percent from a year ago in volume (4,348 mt) but increased 8 percent in value to $11.1 million. For lamb muscle cuts only, January-July exports were up 13 percent in volume (1,264 mt) and 18 percent in value ($7.7 million) including year-over-year growth to Mexico, Central America, the Caribbean and Canada.
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