September 19, 2008

US beef exports surpass imports for the first time since 2003

The US beef industry achieved an important benchmark in July, as the value of beef exports for the first seven months of 2008 surpassed imports for the first time since the discovery of mad cow disease closed most global markets to US beef in December 2003.

Global beef and beef variety meat exports totaled 218.2 million pounds in July, valued at US$363 million, increasing more than 10 percent over the June 2008 total, and reaching 97 percent of the July 2003 export value.

These results pushed the total value of exports for January-July 2008 to US$1.94 billion, a rise of 37 percent over last year and more than US$165 million above the value of beef imports into the US during the same period.

By comparison, US beef exports during the first seven months of 2007 fell nearly US$700 million short of imports, which have declined by 16 percent from the same period a year ago.

Mexico remains the top destination for US beef, with record-high exports totaling 90.2 million pounds in July valued at almost US$147 million. From January through July, exports to Mexico have increased by 19 percent in volume and 23 percent in value over last year.

Beef exports to South Korea are beginning to gain traction, totaling 3.5 million pounds in July, valued at US$6.35 million. At about US$ 2.7 per pound, short ribs are priced about 35 percent higher than a year ago. The chuck cut-out, which also is largely driven by export demand, is priced more than 25 percent higher than at this time last year.

Citing growing strength in Asian markets, USDA boosted its forecast for beef exports last week, raising its outlook for the remainder of 2008 as well as for 2009. Factoring in last week's increase, USDA now forecasts 2008 beef exports to finish 28 percent higher than last year, and to increase by an additional 12 percent in 2009.