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Record US Export Levels Continue

by 5m Editor
17 November 2008, at 10:15am

US - While economic caution flags are flying as we enter the final quarter of 2008, both US beef and pork export levels continued to exceed expectations through the first nine months of the year.

U.S. pork exports built on the record set in August, skyrocketing 61 percent in September over totals from a year ago. U.S. pork and variety meat exports for the month totaled 163,055 metric tons (just shy of 360 million pounds) valued at $425.5 million. Year-to-date, pork exports are up 70 percent in volume versus 2007 to 1.5 million metric tons (3.4 billion pounds) valued at $3.6 billion – a 64 percent increase.

Currency fluctuations and credit issues are affecting the flow of world meat trade, and we will see exports impacted in the final quarter of the year. However, as markets stabilize, demand for U.S. pork and beef should remain strong.

Japan at the forefront of pork markets

Japan, Mexico, Russia and Hong Kong/China were the leading markets for pork exports in September, although Canada set a new monthly record and South Korea continues to grow as a market for U.S. pork.

Japan is now the top market in volume and value for the year at 335,671 metric tons (740 million pounds) valued at $1.1 billion, increases of 26 and 32 percent, respectively. Exports in September were 38 percent higher than last year, totaling 36,394 metric tons (80.2 million pounds).

Mexico was the second-largest destination for U.S. pork in September with exports totaling 29,575 metric tons (65.2 million pounds), up 43 percent from a year ago and putting the January through September total at 267,230 metric tons (589.1 million pounds – a 36 percent hike) valued at $474.5 million, a 48 percent increase. Exports to Mexico peaked in July at 38,973 metric tons (85.9 million pounds), but still remain well above year-ago levels.

The Hong Kong/China region continued to be the second-largest destination measured in volume for U.S. pork through the first nine months of 2008, with exports up 214 percent to 330,601 metric tons (728.8 million pounds) valued at $572 million, a 268 percent jump. After peaking in May and June, export volumes were lower in July and August but rebounded slightly during September to close 33 percent above last year, totaling 22,698 metric tons (50 million pounds), with the bulk of the product going to Hong Kong. The slowdown in exports to China (especially muscle cuts) was anticipated as Chinese pork production is recovering and prices have declined significantly from the peak levels seen early in the year.

Russia ranked third among U.S. pork markets in September with exports totaling 27,157 metric tons (59.9 million pounds), near the record of 28,000 metric tons (61.7 million pounds) set the prior month. For the 2008 calendar year, U.S. pork exports to Russia stand at 168,603 metric tons (371.7 million pounds) valued at $365 million, increases of 185 and 194 percent, respectively.

Muscle cut exports to Russia thus far total 122,268 metric tons (269.5 million pounds), 2.5 times the U.S. quota of 49,800 metric tons (109.8 million pounds), meaning most pork exports were paying the 60 percent over-quota duty instead of the 15 percent in-quota rate. In other words, U.S. pork exports filled the quota in the first four months of the year. After that, the 60 percent duties would equate to more than $107 million!

September pork exports to Canada set a new record at 15,882 metric tons (35 million pounds), narrowly surpassing the 15,853 metric tons exported during July and up 9 percent from a year ago. For 2008, exports volumes are up 21 percent to 125,917 metric tons (277.6 million pounds) valued at $416 million, a 19 percent hike.

Weekly Canadian live hog exports to the United States remain well below year-ago levels, with exports of all live hogs down 4 percent from January through Nov. 8 compared to the same period last year – totaling just over 8 million head. The latest Canadian inventory report showed the breeding herd down 8.3 percent in October. Therefore the trend for lower live hog exports (not to mention the COOL impact) and lower Canadian pork production is expected to continue in 2009.

U.S. pork exports to South Korea remain strong, with September exports at 9,362 metric tons (20.6 million pounds) – more than double export volumes from a year ago. Exports to Korea peaked in April at 13,280 metric tons (29.3 million pounds), but remain well above year-ago levels, with January through September exports up 51 percent to 101,998 metric tons (224.9 million pounds) valued at $215 million, a solid 32 percent increase.

The ASEAN region continues to be a growth market for U.S. pork, with September exports more than double last year at 3,242 metric tons (7.1 million pounds). Exports to the ASEAN region peaked in June at 8,780 metric tons (19.4 million pounds), but for 2008, volumes are up 393 percent to 46,979 metric tons (103.6 million pounds). Of that total, Philippines’ imports are up 246 percent to 22,296 metric tons (49.2 million pounds), Vietnam accounts for 16,361 metric tons (36.1 million pounds – a 1,361 percent jump) and Singapore has imported 7,982 metric tons (17.6 million pounds – a 382 percent increase. Exports to Vietnam have slowed from their record-breaking pace in the April-July period, likely due to lower pork prices in the Greater China region.

Exports to Australia and New Zealand remained strong in September, up 35 percent from last year to 3,064 metric tons (6.7 million pounds) for a year-to-date total of 34,957 metric tons (77.1 million pounds) valued at $98 million, increases of 24 and 14 percent, respectively. Exports to the region peaked in June at 6,000 metric tons (13.2 million pounds).

Exports to the European Union also remain strong at 3,422 metric tons (7.5 million pounds) for September, up 122 percent from last year, putting 2008 totals at 34,567 metric tons (76.2 million pounds) valued at $98 million, up 149 and 143 percent, respectively. USMEF cautions that EU import data should be utilized to measure exports to the EU, as U.S. data indicates U.S. exports would essentially exceed available import licenses (and thus be paying the prohibitive over-quota duties). EU import data shows 16,951 metric tons (37.4 million pounds) imported from the United States in the January through August period, an increase of 167 percent. Chile is the other primary supplier, with imports totaling 10,228 metric tons (22.5 million pounds), up 34 percent.

Another positive region for U.S. pork is Central and South America, with September volume at 3,313 metric tons (7.3 million pounds), up 50 percent from last year. For 2008, pork exports to the region are up 17 percent to 27,109 metric tons (59.8 million pounds). Honduras, Colombia and Guatemala are the top markets.

U.S. pork exports to Taiwan peaked in August at 4,763 metric tons (10.5 million pounds), but September’s volume of 2,503 metric tons (5.5 million pounds) was 218 percent larger than last year and the year-to-date total is up 70 percent to 23,545 metric tons (51.9 million pounds).

September pork exports to the Caribbean remained strong at 3,000 metric tons (6.6 million pounds), nearly double last year. For calendar year 2008, exports are up 50 percent to 23,062 metric tons (50.8 million pounds). These volumes include the Dominican Republic, which accounts for 10,085 metric tons (22.2 million pounds), a 164 percent jump. Trinidad and Tobago and the Bahamas are the largest Caribbean markets.