CME: June US Pork and Beef Trade Data

US - The US beef and pork trade data for the month of June became available last week and below we provide a brief recap of the carcass weight equivalent figures as calculated by USDA/ERS, write Steve Meyer and Len Steiner.
calendar icon 16 August 2010
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The data continues to paint a very bullish picture for US meat protein despite challenges in certain markets.

Beef: Total US beef shipments in June were 204.5 million pounds, 17.8 per cent higher than a year ago and the highest monthly beef export volume since August 2008. US beef exports to Asia have posted strong growth while exports to Canada and Mexico have declined in recent months. Total US beef shipments to Mexico, still the largest market for US beef were 40.8 million pounds, 19.5 million pounds or 32.4 per cent lower than a year ago. Exports to Canada at 28.5 million pounds were 9.5 million pounds or 24.9 per cent lower than last year. The decline in shipments to Mexico and Canada has been more than offset by gains in other markets. Exports to Japan surged in June and at 40.1 million pounds, exports were 8.08 million pounds or 25.3 per cent higher than a year ago. This is the largest monthly beef export volume to Japan since the outbreak of BSE in the US. Keep in mind, however, that the current volume being shipped to Japan still represents only half of what US packers shipped to Japan in June of 2003 (last pre-BSE export year). Exports to South Korea in June were 33.6 million pounds, 25.2 million pounds or 300 per cent larger than a year ago. At this time, US beef exports have returned at the pre-BSE export levels, this despite sharply lower exports to Mexico and Canada.

Pork: Total US pork exports in June were reported to be 365.2 million pounds, 22.9 per cent higher than a year ago and 28.2 per cent higher than the five year average. Pork exports have been steadily increasing in Q2, boosted by strong shipments to both traditional and new markets. Exports to Japan have been particularly strong, which helps explain the strong prices for pork loins we have seen recently. Total pork exports to Japan in June were 131.8 million pounds, 40 million pounds or 43.1 per cent higher than a year ago. It is unlikely that the safeguard tariff will be triggered in Japan this year. The Japanese safeguard tariff is triggered “when quarterly pork imports in the Japanese fiscal year (JFY, 1 April/31 March) surge more than 19 percent above the average imports in the previous three fiscal years” (Source: USDA). When the safeguard is triggered, the minimum import price is increased by 24 per cent. However, the safeguard issue may start to come into play should current trends continue and bears watching. US pork exports to other markets also were quite strong. Exports to Mexico were 86.4 million pounds, 30.2 per cent higher than a year ago while exports to Canada at 34.1 million pound were less than 1 per cent higher than last year.

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