August 18, 2008
US pork makes new high, beef prices rebound


The US pork carcass composite value hit yet another new high on Friday (August 15) at US$94.41, making it the 10th time to do so in the last 12 days.


Wholesale pork prices are seeing strong support from exports as well from a 67-percent gain in volume through the first six months. Hong Kong, China and Russia have been big growth markets for US pork, analysts and the US Meat Export Federation (USMEF) said.


Improved world demand for meat, along with reduced production in the EU and Canada, are contributing to the strength in exports of US pork.


Meanwhile the USDA on Thursday (August 14) reported its closing choice beef cutout value at US$164.84 per hundredweight, the highest since July 22. On Friday, choice beef was down US$0.51 at US$164.33, but it was still US$2.11 higher than a week ago.


The latest quote represented 39-percent retracement of the steep slide that occurred from the five-year high of US$173.80 hit on July 10 to the August 1 quote at US$158.32. The market fell in 15 of those 16 days and lost US$15.48, or nearly 9 percent. Select beef prices have rallied as well and closed the week at US$157.76, up US$1.99 from August 8 and US$6.47 from the latest cycle low of US$151.29 reached on August 1.


Market analysts said increased retail featuring for the end-of-summer Labor Day holiday and improved export sales have contributed to the gain in boxed beef prices. The low value of the dollar's exchange rate against other currencies is helping boost export sales of all commodities, analysts said.


The USMEF reported that US beef "continues to rebuild market share in Japan," which was once the single largest market for beef exports.


Mexico and Canada remain the leading international customers for US beef. Sales to Mexico in the first half were up 18 percent in volume and set a new record at 36,619 tonnes. January-June beef exports to Canada climbed 41 percent from a year ago to 78,790 tonnes. Sales to Russia through June were up as well and for the year are expected to exceed the 2003 volume, USMEF said.

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