April 21, 2014

US February beef exports to Asia up 4%

Driven by strong demand from Japan, Mexico, and Hong Kong, US beef exports were up 4% through February 2014 compared with a year earlier.

The strong demand from Japan, Mexico, and Hong Kong more than offset declining shipments to Canada, South Korea, and Taiwan.

Higher prices for US beef may have limited demand from some markets, including Canada, which has also experienced a depreciating exchange rate with the US dollar. The average exchange rate in February 2014 was nearly 10% lower than the previous year. Higher prices have not discouraged strong sales of beef products to Japan and Hong Kong.

After declining in 2012 due to a drought-induced rise in Mexican beef production, US exports to Mexico rose 15% in 2013 and were up 32% through February.

Due to diminished cattle inventories, demand is likely to remain strong as beef production is not expected to increase significantly this year in Mexico. As a result of strong demand from Asia and Mexico, the forecast for 2014 US beef exports was raised to 2.515 billion pounds, an increase of 80 million pounds from the previous month's forecast. This implies nearly a 3% decline in 2014 beef exports as lower production will limit trade volumes.