CME: New Annual Record for US Pork Exports

by 5m Editor
14 October 2008, at 2:14pm

US - CME's Daily Livestock Report for 13th October 2008.

The latest export data from USDA Foreign Agricultural Service indicates that the U.S. beef and pork sectors enjoyed tremendous success in export markets in August. The charts at the bottom of the page show year-to-date information for beef and pork export volume and value. Some highlights are:

  • Continuing recovery of U.S. beef exports. YTD exports of 901 million pounds represent about two-thirds of the level achieved during January-August 2003, the last year in which U.S. beef exports were not subject to BSE-related restrictions. August 2008 exports were 71% higher than last year and 19% higher than in July.
  • Continued year-on-year growth to key markets — except for Korea. Mexico remains the largest destination for U.S. beef exports at 328 million pounds YTD, 15.8% higher than last year. Shipments to Canada remain record-large and exports to Japan now stand nearly 60% larger than last year though our former number one customer still ranks third for 2008. Beef business with Korea continues to develop slowly. August shipments weres actually 13% smaller than last year. The largest percentage growth among top U.S. beef markets is for Vietnam at +679% from 2007 levels.
  • The value of beef exports (Figure 1) has recovered at a more rapid pace due to higher unit pricing. Total export value through August is 40% higher than last year at $1.815 billion. Canada is the top growth market in dollar terms, gaining $136.8 million to reach $501.6 million for the January-August 2008. Vietnam is again the top percentage growth market, increasing by 832% relative to a very small dollar sales amount for January-August 2007.
  • U.S. PORK EXPORTS HAVE ALREADY SET NEW ANNUAL RECORDS FOR BOTH VOLUME AND VALUE. Everything sold from September onward will only add to the record levels shown here. U.S. Meat Export Federation President and CEO Philip Seng stated “We knew pork exports were headed for an all-time high in 2008, but for the industry to break that record before Labor Day is quite an accomplishment.”
  • The pace of pork export growth declined in August, with total pork export quantity up ONLY 56.7% and value up ONLY 64%. Those are tremendous numbers that pale when compared to the roughly +100% pace set in April through July. The year-over-year growth rate of shipments to China-Hong Kong slowed sharply from +550% to +642% in April through June and +185% in July to just +32% in August. Is this “post-Olympics” slowdown temporary or a shift to a more normal, sustainable growth rate? How is China’s herd rebuilding efforts impacting its pork imports? Only time will tell the answers.
  • August shipments to Russia were 192% larger than one year ago. That comes on the heals of a 174% increase in July. The value of shipments to Russia doubled year-ago levels in both July and August. We think these numbers confirm our thoughts that Russia was a key driver of trimmings prices this summer.
  • Japan remains far and away the largest value market for U.S. pork, accounting for over one-third of the total.

5m Editor