August 20, 2008

In the first half of 2008, the US imported 1.3 billion pounds, down 21 percent on-year due to a weak dollar and high cow slaughter that made foreign beef less competitive at home.

During the period, the US imported 28-percent less beef from Australia, which is the US' largest beef supplier.

High US cattle slaughter has provided large domestic supplies of processing beef for food items. The combination of high domestic supplies, difficult weather conditions in Australia, competing export markets, and exchange rates causing foreign products to be relatively more expensive has led to the sharp decline in imports so far this year.

Australian beef producers supply mostly lean trim to the US used for grinding, but multiple years of drought which led to poor grazing conditions and cow liquidation has caused a decline in supply. Even if sufficient rainfall improves pasture conditions significantly in Australia, supplies from the country may still decrease as herd rebuilding would limit the number of animals sent to slaughter.

Beef imports from South American countries have declined as the attention is turned to the EU and Russia. Compared to the first half of last year, beef imports during the period this year have dropped 25 percent from Brazil, 37 percent from Argentina, and 87 percent from Uruguay.

The US is expected to import about 2.5 billion pounds of beef this year, down 16 percent from last year. For 2009, the US is projected to import 2.8 billion pounds of beef.