September 19, 2008

US pork exports may be blazing up the charts but poultry meat continues to dominate the domestic market, according to University of Missouri economists Glenn Grimes and Ron Plain.

The economists' January-to-July demand index reveals that broiler demand has increased 0.8 percent and turkey demand grew 3.5 percent from last year, while domestic pork and beef demand fell 3.9 percent and 3.7 percent respectively.

Demand for live hogs and live cattle in the first seven months of 2008 jumped 8.9 percent and 1.5 percent respectively but that was due to strong export sales for US meat products and lower imports, said the economists.

The economists said current cattle futures prices are over-optimistic as beef supply is expected to fall 1-2 percent in the first half of 2009, which means demand would have to grow 4-5 percent to achieve current futures prices but that is unlikely to happen due to the weak economy.

Meat and poultry supplies are expected to remain high heading into the first half of 2009, but is likely to tighten in the second half.

There is no certainty in the pork sector which may have difficulties in maintaining its export dominance, as China is showing signs of slowing or shifting its imports amid a strengthening dollar.