May 27, 2011

US weekly beef exports third largest in 2011

US beef exports surged last week to the third largest weekly volume this year, most likely because of a recent drop in beef prices and ongoing weakness in the dollar.

USDA said that last week's beef export sales were at 21,100 tonnes, ranking behind 24,800 tonnes in January and 23,100 tonnes in February.

Year-to-date US beef export sales are 399,500 tonnes, up 30.5% from 2010, USDA said.

"We have had a very big drop in prices the last couple weeks," an analyst said of the recent surge in sales.

Beef exports are expected to stay strong due to reduced exports from global competitors and stronger economies in buying countries.

Wholesale beef prices declined partly because domestic sales have been slow due to a weak economy, high gasoline prices, and a cool, wet spring, analysts said.

USDA's average wholesale price for choice beef went from about US$185 per hundredweight in late April to the mid-US$170s last week. Prices have since recovered to about US$179.

In Thursday's (May 26) export report, Mexico led buyers with 7,100 tonnes, its largest weekly volume this year, followed by South Korea at 4,100 tonnes and Japan at 2,700 tonnes.

"We continue to see good demand from Japan. Japan has never slowed down, which showed that their logistics did not get hurt by the earthquake."

There had been speculation the March 11 earthquake and tsunami in Japan would disrupt trade, but so far beef sales have continued. Two weeks ago, Japan bought 6,500 tonnes, the second largest weekly volume this year after 10,100 tonnes in April.