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October Beef Exports Exceptional

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Date: Wednesday, December 15, 2010

Export value ahead of 2003’s record pace

October was a very strong month for U.S. beef exports, according to the U.S. Meat Export Federation (USMEF), a contractor to the Beef Checkoff Program. Beef exports achieved their second-highest value of the year at $375.3 million – trailing only June's $377.6 million and surpassing the September total by 11 percent and beating October 2009 numbers by an impressive 37 percent.

The strong showing in October pushed 2010 beef export values to $3.28 billion, surpassing the pre-BSE January-October 2003 total of $3.26 billion. (Beef export value finished 2003 with an all-time, single-year record total of $3.86 billion.)

Compared to 2009, beef export value is up by a healthy 28 percent. In terms of volume, beef exports reached 1.9 billion pounds for the year to date, outpacing 2009 by 16 percent. This year's ratio of total U.S. production exported is 11.4 percent, while the value-per-steer-and-heifer slaughtered is $147.62. The per-head value in October actually reached $170 – nearly $50 higher than October 2009.

"With two months of results still to come, we anticipate the possibility of setting a new export value record this year," said USMEF President and CEO Philip Seng. "But the long climb back from the BSE setback of 2003 is not just about rebuilding our mainstay markets. We've established a presence for U.S. beef in many new and diverse destinations across the globe in order to get back to this level. So now the key is to achieve full restoration of all markets so we can take U.S. beef to even greater heights."  

U.S. beef exports have achieved a significant increase in virtually every major destination, except for Mexico, this year – and even that market is improving late in the year. While exports to Mexico are down for the year, October totals were up 5 percent in volume (48.9 million pounds) and 10 percent in value ($71.9 million) over October 2009.

Exports to Canada are up only slightly in volume this year (272.3 million pounds) but have surged by 10 percent in value to $589 million. Japan is up 31 percent, both in volume (227.2 million pounds) and value ($528.5 million). Korea remains in fourth place but has achieved exceptional growth this year, jumping 125 percent in volume to nearly 200 million pounds and 168 percent in value to $422.3 million.

"The turnaround for U.S. beef in Korea has been remarkable, and we remain committed to sustaining the momentum with aggressive marketing efforts, including the recent launch of phase two of the 'Trust' imaging campaign," Seng said. "Having regained a high level of consumer confidence, we are now able to emphasize the quality and enjoyment U.S. beef delivers, rather than focus solely on safety. While safety remains a key point with Korean consumers, we're now better able to differentiate U.S. beef for its flavor and consistency – which is what really appeals to buyers."  

Other markets achieving strong growth in 2010 include Russia, where exports have more than doubled in volume (109.7 million pounds) and quadrupled in value to $134.3 million. This reflects a nearly 700 percent surge in muscle-cut exports to Russia, valued at $95.3 million! Exports to Taiwan have eclipsed the previous record, reaching about 69.5 million pounds valued at $172.4 million. This is an increase of 42 percent in volume and 51 percent in value over 2009 levels. Exports to Hong Kong are also up sharply this year – 53 percent in volume (63.3 million pounds) and 70 percent in value ($109.2 million).

The Middle East has emerged as a region of tremendous growth for U.S. beef, as well, with exports increasing by 28 percent in volume to nearly 231 million pounds and 65 percent in value to $200 million. Like Russia, this sharp increase in value reflects a strong surge in muscle-cut demand, though the region remains a top destination for beef variety meat. Fueled by solid growth in exports to Indonesia and the Philippines, exports to the ASEAN region are up 10 percent in volume (126.4 million pounds) and 16 percent in value to $187.4 million, despite a down year for exports to Vietnam.  

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The Beef Checkoff Program was established as part of the 1985 Farm Bill. The checkoff assesses $1 per head on the sale of live domestic and imported cattle, in addition to a comparable assessment on imported beef and beef products. States retain up to 50 cents on the dollar and forward the other 50 cents per head to the Cattlemen’s Beef Promotion and Research Board, which administers the national checkoff program, subject to USDA approval.
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