US - On the heals of a difficult year for US meat exports, EMI Analytics is confident lower prices will result in a turn around in 2016, writes Bruce Cochrane.
UDSA is forecasting an increase in meat exports during 2016.
Dr Steve Meyer, the Vice-President Pork Analysis with EMI Analytics, recalls last year was tough for US meat exports, primarily due to a 20 percent run up in the value of the US dollar which pushed U.S prices higher relative to the competition, including Canada, in many markets and gave the EU, which had product on hand, because the Russians weren't buying it, a big advantage.
Dr Steve Meyer-EMI Analytics:
It's been a tough year. The beef industry was hurt far more than the pork industry and then the US, pork industry had that port slowdown a year ago that got us off to a terrible start and we kind of came back and ended up up a short 2 percent for the year on exports so it did show a little bit of growth.
Beef exports were down roughly 10 percent.
After a not very good last year, it couldn't be anything but better this year and so the forecasts are for the beef exports to bounce back some.
Number 1 is our product prices will be lower than they were a year and a half and so that'll offset some of this disadvantage with the dollar.
The high dollar is still there, but at least the disruptive action of, as the dollar changes.
When exchange rates are changing there's a huge amount of disruption from a timing standpoint.
Even if they're unfavorable to you but stable that's a better situation and that's where we are now and we think we're going to stay there.
We agree with the USDA. We think we're gong to see some increase in exports. We've got pork exports up a little more than what they do. They've got them at 3.2 percent.
We would say more in the 4 to 5 percent range this year. We got off to a nice start with a 10 percent increase relative to last year in January. So there is some improvement and we think that's going to continue.
Dr Meyer expects the US dollar to remain at about the same level over the next year.
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