Disappointment with US First Half Pork Exports

US - June export data, released by USDA and compiled by the US Meat Export Federation (USMEF), reflected a challenging first half of 2015 for US pork exports.
calendar icon 24 August 2015
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June pork exports totalled 174,554 metric tons (mt), down 4 per cent from a year ago. With pork prices down significantly from last year’s high levels, June export value fell 22 per cent year-over-year to $454 million.

For the first half of 2015, pork exports were down 5 per cent in volume (1.09 million mt) and 16 per cent in value ($2.88 billion).

“We were aware that exports would be facing obstacles in 2015, and that keeping pace with last year’s record performance would be difficult,” said Philip Seng, USMEF president and CEO.

“The first-quarter slump was partially due to the West Coast port labour impasse, as well as intense competition from countries that continue to recognise opportunities in several markets.

"We were expecting to see a stronger rebound in the second quarter – and that did not materialise.”

June pork exports to Mexico were the largest since March, up 13 per cent from a year ago to 62,112 mt.

While first-half export value ($619.3 million, down 18 per cent) reflected lower prices for hams and other cuts typically shipped to Mexico, export volume remained very strong (353,296 mt, up 6 per cent).

Pork exports to South Korea moderated in June to 12,512 mt, up 55 per cent from a year ago, but the smallest volume since November 2014. June export value was $33.1 million, up 17 per cent. Korea’s first-half performance was stellar, with volume increasing 40 per cent to 108,198 mt and value up 35 per cent to $318.2 million.

Japan remained the leading value destination for US pork, despite a 20 per cent decline from last year’s pace to $835.4 million. Export volume to Japan fell 13 per cent to 221,776, as Japan’s total imports also slowed.

Exports to the China/Hong Kong region fell 17 per cent in volume (157,860 mt) and 22 per cent in value ($330.9 million) from a year ago as the US industry continues to lose market share due to lack of China-eligible supplies and the small number of plants approved to serve China.

Demand for imported pork in China is on the rise due to an uptick in domestic prices and tight domestic supplies, but these opportunities are mostly being seized by European suppliers.

“Our limited access to China has become a major obstacle for US pork, especially with competition intensifying in so many other global markets,” Mr Seng said. “It’s a situation that absolutely must be addressed in order for US exports to regain momentum.”

Exports to Canada held up relatively well, considering the weakness of the Canadian dollar versus the US dollar. Export volume was down 6 per cent to 95,443 mt while value fell 10 per cent to $382.7 million.

January-June pork exports accounted for 25 per cent of total production and 21 per cent for muscle cuts only (down from 28 per cent and 24 per cent, respectively, in the first half of last year). Export value averaged $50.85 per head slaughtered, down 22 per cent year-over-year and 5 per cent lower than in 2013.

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