September 24, 2013

 

 

In the past few months, US net beef exports have grown appreciably and have reached 72.3 million pounds in July 2013.

 

This is according to Darrell Mark, adjunct professor of economics at South Dakota State University.

 

He explains that net beef exports, exports minus imports, have been higher than last year on a monthly basis from May through July 2013, which is the most recent month for which data are available. "From January through July 2013, the US exported 42 million more pounds of beef than it imported. During the same seven months in 2012, the US imported 30 million more pounds of beef than it exported," Mark said.

 

He noted that net exports have expanded as a result of both higher exports and lower imports in recent months. In July, US beef and veal exports totalled 264.6 million pounds, 14.7% more than in July 2012 and 32% more than the previous five-year average for July. Exports to Japan, which totalled 80.5 million pounds in July, have led the increase in US beef exports. Exports to Japan have surged since Japan changed the trade restriction to allow beef from cattle less than 30 months old to be imported from the US instead of the more restrictive 20 month old requirement that had been in place.

 

Among the other large US beef export customers are Canada and Mexico, both increased in July 2013 relative to a year ago. Mark said Canada imported 15% more beef from the US while Mexico imported 32% more US beef. "For both countries, increased imports of US beef have likely resulted from smaller domestic beef supplies following liquidation of their cattle herds in the last couple of years," he added.

 

Mark explained that in July 2013, the US exported 27% less beef to South Korea than in July 2012 and exports to the country have averaged 26% lower in January-July of 2013. But, he says exports to other Asian countries have improved, particularly, beef exports to Taiwan and Hong Kong have increased by 166% and 70%, respectively, for the January-July period. "Many of these exports are believed to reach China, a potentially large-growth market for beef," he said

 

The US has imported less beef in 2013, although July 2013 US beef imports were on pace with July 2012, imports from January to July were down 2%. Of interest in the July trade data are changes in the countries supplying beef to the US," he says, explaining that beef imports from Canada and Mexico were down 4% and 1%, respectively. "Again, this reflects smaller beef supplies in those countries after liquidation of their cattle herds."

 

Imports from New Zealand were also 16% lower, which had emerged as a large supplier of beef to the US earlier in 2013 following drought in that country that caused increase slaughter of its cattle herd. In July 2013, the US imported more beef from Argentina, Brazil and Uruguay which increased 81%, 16% and 18%, respectively, compared with July 2012.

 

In the September 12 World Agriculture Supply and Demand Estimates report, USDA forecasted 2013 annual US beef imports and exports to be 2.298 million and 2.408 million pounds, respectively.

 

"If realised, that would make the US a net exporter of beef for the fourth consecutive year," he says. "USDA forecasts beef imports in 2014 to be 2.64 million pounds and beef exports next year to be 2.3 million pounds, which would result in the US being a net importer of beef on a volume basis, which is not uncommon by historical standards."

 

The lower export forecasts are predicated on declining cattle numbers and beef supplies in the US. But, Mark says growing demand from other countries, particularly China, may divert beef exported from other countries away from the US in coming years, which would effectively lower US beef imports.