USMEF believes the US share of global pork exports will increase from an estimated 28 percent reported for 2007, to 32 percent by 2017. Although reductions are expected in the short term - predominantly during the next three years as a consequence of stabilising domestic and global markets. However, growth is expected and will be fueled by a strong global demand and the weak US dollar.

USDA originally projected pork exports to increase five percent in 2008 and three percent annually for the next ten years. But recent forecasts call for a 16 percent increase in 2008 pork exports to 3.7 billion pounds. A number of factors have influenced the improved forecast, including China’s domestic production and market access restrictions, recovery of exports to Mexico, and continued over-quota exports to Russia, says Erin Daley, USMEF manager of research and analysis.

On the up

US pork production also is expected to increase five percent in 2008 - a factors that is expected to contribute to an expected one pound per capita increase in domestic pork consumption this year. The increased production may also have a moderating effect on prices. Beyond 2008, projections by the USMEF are for increases for 2009 through to 2014. Estimates are between four and five percent per year, which will be driven by the same factors that led to improvements in to 2008 forecast.

In addition, the USMEF projection assumes approval of the South Korea/United States free trade agreement in 2009 and steady growth in exports to Japan – about three percent annually. USDA forecasts 39 percent growth in US pork exports over the next 10 years, or an additional 536,000 metric tons (1.18 billion pounds) for total 2017 exports of 1.9 million metric tons (nearly 4.2 billion pounds), up from 2007 estimated totals of 3 billion pounds.

Challengers

However, there will be competition. Key global competitors include:

• Brazil, where exports are expected to reach 775,000 metric tons (1.7 billion pounds) for 2008, an 8 percent increase over the 2007 trade. The country exported 24 percent of its pork production in 2007, and production is projected to grow four percent this year. Consumption is rising at around two percent, annually.
  
  
• Canada, although new estimates show relatively flat exports over the next decade, the strong Canadian dollar has had a profound impact on livestock and meat trade flows in North America. US imports of Canadian slaughter hogs increased 20 percent in 2007 and feeder imports increased 12 percent for a combined total of about 10 million head. This resulted in lower Canadian pork production and exports in 2007, and increased US pork exports to Canada. High feed and labour costs will continue to impact Canadian pork production and thus pork exports.
  
  
• European Union (EU, where exports have been revised to show a 10 percent drop during 2008 (totaling 1,147,000 metric tons – more than 2.5 billion pounds). Exports are not expected to exceed 2006 volumes until 2016. The reduction in expected EU exports reflects expected contraction of the EU pork industry. The European Commission’s reintroduction of export subsidies for chilled and frozen pork exports in November 2007 is one sign of the difficult times facing EU pork producers. High feed costs combined with environmental regulations and increasing costs of all inputs have led to negative returns in the industry. USDA forecasts show US pork exports surpassing EU trade during 2007 and continuing to exceed them during the next ten years.

Further Reading

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