CME Report: Continued Growth for the Value of US Pork Exports

US - USDA’s Foreign Agricultural Service released export figures for July yesterday and they show continued growth for the value of US pork exports, report Steve Meyer and Len Steiner.
calendar icon 8 September 2014
clock icon 4 minute read

Tonnage was down slightly (1.5 per cent) in July versus one year ago but the value of those shipment was up near 18 per cent. Data for the world total and the top 20 markets (per normal practice we combine China and Hong Kong) appear in the table below.

Some Other Highlights Are:

Mexico was a clear winner in the race for the largest destination for US pork cuts in July, taking 41,549 metric tons, nearly one third more than second place Japan. This year’s July export volume to Mexico was 3 per cent higher than one year ago. What is remarkable, however, is that the value of those exports was 24 per cent higher, year on year. Mexico has long had the reputation of a very price sensitive market and the value of our pork exports southward still trails the value of exports to Japan significantly. But Mexican buyers have shown a surprising willingness to pay this year’s record prices for US pork cuts. — at least partially out of necessity given that Mexico has dealt with significant PEDv losses as well.

Mexico has now taken a significant lead in year to date purchases with 294,165 MT. Shipoments to Japan through July were 245,497 metric tons.

Japan is still by far our largest valued pork export market both in July and year to date. Japan’s purchases through July amount to $1.126 billion, 54 per cent higher than second place Mexico.

While we talk a lot about new markets and the status of China Hong Kong and Russia, let’s not forget that Japan, Mexico and Canada account for the lion’s share of US pork exports — 68.8 per cent of value and 63.6 per cent of volume through July .

Russia leads the pack in terms of year on year growth but we all know that is beside the point for several reasons. First, it is caused by shipments to Russia being near nill in 2013. Second, Russia’s embargo to retaliate for Ukraine related sanctions imposed by the US began in July and will have a huge impact on exports from August forward.

China Hong Kong slipped to number six in the rankings in July with shipments falling 49 per cent short of last year’s level in volume and 53 per cent short in value. The year to date figures are still close to one year ago but those were significantly higher than in 2013 as late as March before falling sharply from April forward. Ample domestic supplies and resulting low domestic prices have left US product in a touch competitive spot.

South Korea continues to grow. July shipments were up 23 per cent in volume and 64 per cent in value. Year to date pork cut exports to Korea stand 29 per cent higher than last year. The value of those shipments is up 52 per cent.

Colombia, Australia and Philippines have slowly but steadily become very important markets for US pork. Australia has actually taken more product in terms of both volume and value this year than has Russia — and without all of the drama! Colombia is the clear leader among growth markets with July purchases up 28 per cent in volume and 68 per cent in value and YTD purchases up 77 per cent in volume and 97 per cent in value.

Bottom Line: US pork exports have performed remarkably well given this year’s price scenario. One cloud on the horizon is the rising US dollar. Dollar Index futures are up over 6 per cent since early May.

Further Reading

You can view the full report by clicking here.

Charlotte Rowney

© 2000 - 2023 - Global Ag Media. All Rights Reserved | No part of this site may be reproduced without permission.