July 12, 2004

 

 

Most Meat Exports Down In US

 

Beef and poultry exports should close out 2004 down significantly, according to a report from the United States Department of Agriculture, and Tyson Foods is feeling the pinch.

 

The outlook -- authored by Dale Leuck, Mildred Haley and David Harvey -- says continued mad cow disease and avian influenza concerns are stifling export markets for those proteins. Pork, the trio says, is headed for a record year export wise.

 

The report shows the numbers for beef as the most striking. The USDA predicts beef exports will drop 82 percent from a record 2.5 billion pounds in 2003 to around 451 million pounds this year if current bans remain in place.

 

The biggest hit comes from trade restrictions on beef in Japan, which accounted for 30 percent of beef exports in terms of sales in 2003.

 

Tyson culled 49 percent of its $24.5 billion in 2003 sales from beef, and the Springdale-based company got 18.4 percent of its $11.9 billion in beef sales from export markets.

 

However, Tyson's International beef sales in the most recent fiscal quarter fell 39.9 percent.

 

According to figures on the National Cattlemen's Beef Association Web site, exports increased from $10.1 million in January to $24.8 million in March, the most recent month for which statistics are available. By comparison, beef exports netted $236.2 million in March 2003.

 

The industry is slowly recovering, however, according to David Weaber, director of research for Colorado-based Cattle-Fax. Weaber said beef producers have recovered about 25 to 30 percent of export markets which closed following the December discovery of mad cow disease in a Washington state dairy cow.

 

Weaber said he is encouraged by U.S. discussions with Japan to open that country's borders to beef.

 

"At least they are talking and willing to negotiate," Weaber said. "Maybe it's the light at the end of the tunnel, or it could be just the light of the train."

 

By weight, poultry is the most-exported meat produced in the United States. In 2003, the country shipped 5.5 billion pounds of broilers, turkeys and other chicken meat to foreign countries, up 2 percent from 2002.

 

"Since late 2003, the world poultry industry has been affected by outbreaks of avian influenza in the United States and Southeast Asia, and associated bans on poultry in many countries," the report states.

 

The USDA said poultry exports are expected to decline by about 12 percent in 2004 under current bans, placing them 22 percent below the record 6.2 billion pound mark for 2001.

 

"It's been a challenging year for chicken exports," Tyson spokesman Gary Mickelson said. "Many countries have lifted their bans on U.S. poultry. More are expected to do the same, and we're beginning to see our export business improve."

 

Tyson's international chicken sales totaled almost $800 million in fiscal 2003, which accounted for about 10.8 percent of the firm's $7.35 billion in chicken sales.

 

Richard Lobb of the National Chicken Council said his organization is encouraged by the value of the chicken being sold.

 

He said while exports by weight were off by 7 percent for April -- the most recent month he had figures for -- sales in terms of dollar value were up 35 percent.

 

With foreign concerns about consuming U.S. beef and bird, the pork industry continues to set records.

 

The USDA report said pork exports have increased annually by nearly 16 percent since 1990. In 2003, the country sent almost 1.72 billion pounds of pork products to other countries, up 7 percent from 2002. The report predicts 21 percent growth in 2004, to 2.07 billion pounds.

 

Mickelson said pork exports have been strong so far this year largely because mad cow concerns have some export customers turning to pork.

 

"For example, ham sales to Mexico have been excellent," he said.

 

Tyson reported second fiscal quarter international pork sales rose 73.5 percent over the same period in 2003. Pork accounted for about $2.45 billion -- or 10 percent -- of Tyson's total 2003 fiscal sales.

 

International pork sales totaled $255.4 million in that period, or just more than 10 percent.

 

Barb Determan, spokeswoman for the National Pork Producers Council, said exports are up for a variety of reasons aside from mad cow or bird flu scares.

 

She cited the value of the U.S. dollar against other currencies, increasing exports to Mexico and opening new markets, such as a pact with Australia that will soon send U.S. pork there.