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August’s U.S. beef exports hit record $1 billion; pork exports keep 2020 record pace

 
By Doug Schmitz
Iowa Correspondent

DENVER, Colo. – U.S. beef exports in August hit another new value record, topping $1 billion for the first time, while U.S. pork exports posted another strong month, keeping last year’s record pace, according to data released by the USDA and compiled by the U.S. Meat Export Federation.
“The August export results would be impressive under any circumstances, but achieving these totals despite all the COVID-19-related obstacles at home and overseas is truly remarkable,” said Dan Halstrom, federation president and CEO.
“Our transportation and labor situation is challenging, and customers continue to face an uncertain business climate due to foodservice restrictions and other economic headwinds. Yet international buyers remain committed to the quality and consistency delivered by U.S. red meat, and the U.S. industry has gone to tremendous lengths to keep shipments moving.”
He said the one factor contributing to the high export numbers is global demand.
“Demand globally is as good as it’s ever been, and there are two big markets doing a lot of that: China and Japan,” he said. “There are a lot of smaller markets (as well); we have countries in South America. The morale of the story is: Demand is not only good, it’s broad-based.
“There’s a similar scenario (with pork), but with one big difference. We have broad-based growth across several markets: Mexico, Central and South America, and the Philippines.”
He said the broad-based growth achieved in 2021 bodes well for both near- and long-term exports. “Obviously, breaking the $1 billion mark in a single month is a huge milestone for U.S. beef, and that’s not possible unless a wide range of markets are hitting on all cylinders,” he said.
“But the trend lines for U.S. pork are also very encouraging,” he added. “Just a few years ago, it was an achievement to reach $6 billion in pork export value in a full year. In 2021, exports will exceed that total, with an entire quarter to spare.”
The report said August beef exports totaled 132,577 metric tons, up 21 percent from a year ago, and the second largest volume this year, while export value climbed 55 percent to $1.04 billion.
For January through August, beef exports increased 18 percent from a year ago to 955,407 metric tons, with value up 34 percent to $6.62 billion. Exports were also 6 percent higher in volume, and up 20 percent in value, compared to the record pace established in 2018.
The report said pork exports totaled 225,822 metric tons in August, up 4 percent from a year ago, and value increased 20 percent to $633.9 million as record shipments to Mexico. For January through August, exports were 1.5 percent above last year, at just over 2 million metric tons, while value climbed 10 percent to $5.62 billion, the report said.
The report said beef exports to China have climbed steadily since early 2020, when market access barriers were greatly reduced under the U.S.-China Phase One Economic and Trade Agreement. August marked the best performance to date, with exports topping 20,000 metric tons for the first time, and value reaching $182.2 million (both volume and value were more than five times the year-ago totals).
The report said August beef exports to Japan were the largest of the year at 31,573 metric tons, up 21 percent from a year ago, while value soared 79 percent to $233.6 million. For January through August, exports to Japan pulled 3 percent ahead of last year’s pace at 216,409 metric tons.
Andrew P. Griffith, University of Tennessee assistant extension professor of agricultural economics, said, “Japan and Korea have been top destinations for beef for a long time, while China just stepped on the scene 18 to 24 months ago. Our top competitors to those three countries (Japan, Korea, and China) would typically be Australia and Brazil.
“We have extremely competitive trade agreements with Japan and Korea as it relates to competing with Australia, (which) has spent the past couple of years recovering from drought and rebuilding their cattle herd, which meant we were able to get a little of their market share in all three countries. The factors that led to $1 billion in sales is the fact that we are moving a significant quantity of beef to China, and high beef prices. High beef prices are probably the primary reason. It is clear there is strong international demand for U.S. beef.”
The report said beef exports to Korea were down 11 percent from last August’s large volume at 24,294 metric tons, but export value still increased 18 percent to $216.9 million – the second largest total on record, trailing only May 2021. Through August, exports to Korea are on a record pace at 189,963 metric tons, up 13 percent from a year ago, while export value jumped 28 percent to $1.51 billion.
With the strong performance from Japan and Korea and further momentum expected as foodservice restrictions ease, the U.S. beef industry is on track to have two $2 billion export markets for the first time in 2021, the report said.
Halstrom said, “In Latin America, the COVID-19 restrictions have been relaxed for several months. Asia still has restrictions, but demand is still good. Retail is doing well and demand is up,” even though foodservice may be down a bit.
Griffith said, “Regardless of COVID-19, people have to eat, which keeps the trade flow open. The struggles are with labor and shipping containers. That has less to do with coronavirus and more to do with labor to load and unload containers.”
From the beef and pork processing labor standpoint, he said there have been some struggles, but packers have offered enough incentives and higher pay to ensure they get the number of head slaughtered that is needed.
“There are sure to be facilities that are under-staffed with workers, but packers continue to control the leverage over cattle feeders,” he said. “COVID-19 has demonstrated a strong demand for beef and pork, both domestically and internationally. Meat businesses see this, and they keep moving forward.”
To read the full report, visit: www.usmef.org.
10/26/2021