August 21, 2009

The US imported 751 million pounds of beef in the second quarter of 2009, up nearly 14 percent on-year.

 

Beef imports from Australia during the second quarter increased 54 percent on-year. US imports of Australian beef had decreased since the high volume in April partly due to the weakening of the US dollar over the past few months. However, the Australian dollar has depreciated over 17 percent since April 1, 2009.

 

While Australian beef is less expensive than last year, it has lost some of the price competitiveness that it saw earlier in the year, and more Australian exports are going to the large Asian markets of Japan and South Korea. Additionally, a larger share of Australian exports is being sent to historically smaller Asian markets, including Indonesia, Malaysia, and Taiwan.

 

US imports of New Zealand beef increased 13 percent on-year in the second quarter. New Zealand cow slaughter has increased 26 percent through June, according to Statistics New Zealand, as a result of increased culling and reduced milk production in the New Zealand dairy industry.

 

New Zealand's cow slaughter peaks in April and May, as the Southern Hemisphere begins its winter. The increased production levels have led to increased New Zealand beef exports. The US, which accounts for nearly half of New Zealand's beef exports, has had increased levels of imports from New Zealand beginning in June and continuing through July, according to Customs reports and official trade statistics.

 

Imports from Canada decreased more than 13 percent on-year in the second quarter. Total beef production has decreased in Canada, but fed beef production is higher than a year ago.

 

CanFax's feedlot survey of Alberta and Saskatchewan showed that higher placements and inventories earlier this year resulted in increased marketings of fed cattle in June and July. In addition to increasing the supply of beef cuts, higher Canadian feedlot placements and marketings have also increased the amount of fed cattle trim.

 

Trimmings account for nearly half of US beef imports from Canada so far this year, based on AgCanada figures.

 

Trimmings are typically combined with processing beef from cows or imported grass-fed beef to make ground beef. With large supplies of processing beef available in the US from high dairy cow slaughter and large amounts of Oceanic imports, supplies of trim could be limited as fed beef production declines in the US and Canada in the months ahead.

 

Weekly AgCanada figures show that Canadian exports of trimmings have remained higher than last year. However, Canadian feedlot inventories were below last year's levels as of August 1, which should limit fed cattle marketings and fed cattle trim available from Canada, putting upward pressure on ground beef prices.

 

The US is expected to import over 2.8 billion pounds of beef in total in 2009, a 12-percent increase from last year, as increased imports from Australia and New Zealand are expected to more than offset the decline in imports from Canada. Imports are expected to continue increasing, but at a slower rate in 2010, to almost three billion pounds.