March Beef Exports Show Positive Momentum
Posted on 5/7/2015 by Melissa JacksonTweet Email
Though down slightly from February 2015, the value of U.S. beef exports in March -- at $527.3 million in -- was up 2 percent year-on-year, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF), a contractor to the Beef Checkoff Program.
Meanwhile, the volume of beef exports in March totaled 191.3 million pounds, down 7 percent from a year ago but a 5 percent increase over February 2015. The March results reflect some degree of relief from the West Coast port congestion that plagued red meat exports in January and February. Port traffic began to improve after a tentative labor contract was reached in late February, though congestion lingered for several weeks at some major ports.
“Port congestion remained an issue well into March – and even into April in the Southern California ports – but the announcement of the new labor contract certainly improved the business climate,” said USMEF President and CEO Philip Seng. “After months of frustration, the U.S. meat industry was finally able to reassure Asian buyers that the worst of the crisis was behind us and that they could once again count on the U.S. to fulfill its role as a reliable supplier. This was especially important for customers purchasing chilled beef, which requires very prompt delivery due to product shelf life.”
In addition to shipping concerns, U.S. exporters have found their competitive position in some key markets damaged by large volumes of lower-priced products from other supplying countries. In many cases, diminished purchasing power due to the strength of the U.S. dollar has made the price disadvantage even more severe. Market access barriers also remain a concern in some markets, most importantly China and Russia.
“In the beef complex, the projected slowdown in Australia’s production may still be coming but certainly did not materialize in the first quarter," Seng said.
“These are unusual conditions that are made more difficult by the strong U.S. dollar, but now isn’t the time to dwell on the stiff headwinds we are facing. We must aggressively defend the customer base the U.S. industry has worked so hard to build over the years by reaffirming the value and quality delivered by U.S. red meat.”
Japan, Mexico still mainstays for U.S. beef
March beef exports accounted for 13 percent of total production and 10 percent for muscle cuts only, slightly exceeding first-quarter ratios but down from 14 percent and 11 percent, respectively, in March 2014. Export value per head of fed slaughter was $284.30 in March, up 5 percent from a year ago. For the first quarter, per-head export value was $290.32, up 9 percent year-on-year.
So far in 2015, beef exports to Japan have performed extremely well, despite significant obstacles – including the West Coast port situation, a weakened Japanese yen and a tariff advantage for Australian beef under the recently implemented Japan-Australia Economic Partnership Agreement. First-quarter exports to Japan increased 4 percent in volume (106.6 million pounds) and 11 percent in value ($322.8 million). Exports to Mexico increased 4 percent in value ($285 million), despite slipping 1 percent in volume (124.7 million pounds).
Beef exports to Korea got off to a slow start in 2015, but continued to gain momentum in March. Still, first-quarter value was up 2 percent to #204.1 million, but volume -- at 60.9 million pounds -- was down 4 percent from a year ago. Exports to Taiwan trended in the opposite direction, slowing in March after a very solid start. First-quarter value was up 11 percent to $64.1 million, even though volume to Taiwan was down 10 percent to 14.1 million pounds. Exports to Hong Kong, which were record-large in 2014 but slowed toward the end of the year, were down 21 percent in volume (61.4 million pounds) and 6 percent in value ($211.9 million) in the first quarter.
Complete January-March export results are available on the USMEF statistics webpage.
For more information, please contact Joe Schuele at firstname.lastname@example.org or 303-226-7309.