April 10, 2013

US beef export value picks up 5% in February amid mixed demands

US beef exports in February continued the trend set at the end of 2012, with a 5% increase in value amid lower volumes, according to statistics released by USDA and compiled by the US Meat Export Federation (USMEF).

Beef exports managed a 5% increase in value (US$430 million) over February 2012 despite a slight decline in volume to 86,367 tonnes.

"The good news is that the long-awaited change in beef access to Japan came through in February," said USMEF president and CEO Philip Seng. "Conversely, trade barriers and other obstacles seem to be emerging at a rather alarming rate in 2013. Sluggish economic conditions in certain markets also create a challenge, but this is why we have made such a strong effort to diversify our destinations for red meat exports over the years. As some of our key markets struggle, growth in other regions has helped provide balance."

Through the first two months of the year, beef exports totalled 172,975 tonnes valued at US$873.8 million, 2% lower in volume but 7% higher in value than last year's pace. Beef export value in February averaged US$239 per head of fed slaughter - up nearly US$31 from a year ago. This drove the January-February export value to US$220.39 per head, compared to US$202.89 in 2012. The percentage of US beef production exported in February was 10% for muscle cuts and 13.4% for combined muscle cuts and variety meat. This compares to 9% and 12.6%, respectively, from a year ago.

Beef exports to Canada are off to a good start in 2013, totalling 31,464 tonnes, an increase of 31%, valued at US$200.2 million (an increase of 46%) through February.

Other markets performing well above year-ago levels include Hong Kong, with 15,821 tonnes (144% increase) valued at US$85.5 million (126% increase); Taiwan, with 5,708 tonnes (16% increase) valued at US$42.6 million (39% increase); and Philippines, 2,463 tonnes (19% increase) valued at US$11.3 million (45% increase).

Because access for US beef exports to Japan was expanded on February 1 to include beef from cattle less than 30 months of age (up from 21 months), expectations for the month were very high. Exports to Japan did record small gains in February and moved 3% higher in volume (19,918 tonnes) and 12% higher in value (US$137.9 million) for the year. Based on weekly export data the improvement in market access didn't trigger an increase in export activity late February, so the impact will be more pronounced in March.

The ractopamine impasse with Russia has had a dramatic impact on this year's export results. Coming off a record year in 2012, beef exports to Russia through February totalled only 1,693 tonnes (-82%) valued at $2.1 million (-94%). The downturn in beef exports to Russia alone more than accounted for the overall volume decline in February.

Exports to former top market Mexico were also sharply lower at 29,933 tonnes, a decline of 21%, valued at US$130.6 million, a decline of 23%.