November 14, 2016
USMEF: September results show strong third quarter for red meat exports
September was another solid month for US red meat exports, with pork, beef and lamb totals well above year-ago levels, according to statistics released by USDA and compiled by the US Meat Export Federation (USMEF).
September beef export volume was 101,224 tonnes, down slightly from August, but 27% above last September. Third-quarter volume was 307,383 tonnes, the largest since the fourth quarter of 2014. For January through September, export volume was 8% above last year's pace at 848,930 tonnes. September export value was up 17% from a year ago to US$533.3 million. For the first three quarters of 2016, export value was US$4.54 billion, down 5% from a year ago.
Beef exports accounted for 13.5% of total beef production in September and 10% for muscle cuts only. January-September ratios were also 13.5% and 10%, up slightly from a year ago. Export value per head of fed slaughter averaged US$256.98 in September, the first year-over-year increase (up 10%) of 2016. Through September, export value averaged US$253 per head, down 10% from last year.
September pork export volume was 183,936 tonnes – also down slightly from August but up 7% from a year ago. For January through September, export volume was 5% above last year's pace at 1.66 million tonnes. September export value was up 8% from a year ago to US$491 million, while January-September export value was US$4.27 billion, up 1% from the same period last year.
Exports accounted for 24% of total pork production in September and 20% for muscle cuts only. January-September ratios were 25% and 21%, up slightly from last year, mainly reflecting growth in variety meat exports to China/Hong Kong. Export value per head slaughtered averaged US$48.29 in September, up 3% year-over-year. January-September export value was down slightly, averaging US$49.24.
"Red meat exports continued to build positive momentum in September, and it couldn't come at a better time," said Philip Seng, USMEF president and CEO. "We have large supplies of pork and beef (reaching) the market and moving these higher volumes is certainly a challenge. But this is also presenting expanded opportunities in the international markets, as we are able to introduce new cuts and value-added products, and recapture market share from our key competitors."
Seng noted that while the upward trend in export volume is encouraging, it is also critical that exports contribute to carcass value and deliver returns for the entire supply chain. For example, per-unit values for pork exports have trended higher since June, and chilled beef exports to Asia are performing exceptionally well this year.
September beef exports reach new milestones in Japan, Korea
September beef exports were led by tremendous year-over-year growth in Japan (22,882 tonnes, up 49% year-over-year) and South Korea (14,840 tonnes, up 75%). Export value in these markets also surged, up 32% in Japan (US$132.1 million) and 83% in Korea (US$86.6 million). Japan's imports of US chilled beef surpassed chilled imports from Australia for the first time ever in September, and based on preliminary October data Korea's total beef imports from the US also topped Australian beef. For January through September, US beef exports to Japan were up 20% in volume to 193,457 tonnes and increased 11% in value to US$1.12 billion. Exports to South Korea were up 33% in volume (122,695 tonnes) and reached US$715.5 million in value – up 17% from a year ago and on pace to exceed the 2014 full-year record of US$847.4 million.
Other January-September highlights for U.S. beef exports include:
Strong September results pushed exports to Taiwan 12% ahead of last year's pace in volume (30,064 tonnes) and up 2% in value (US$245.6 million). The US holds two-thirds of the chilled beef market in Taiwan, the highest share of any Asian market.
Despite a persistently weak peso, beef exports to Mexico were up 8% from a year ago to 174,667 tonnes, including a 10% increase in muscle cuts (90,724 tonnes). Export value to Mexico has trended lower this year, down 9% for total exports (US$732.5 million) and 10% for muscle cuts (US$538 million).
While January-September exports to Hong Kong were lower in both volume (74,945 tonnes, down 5%) and value (US$452.5 million, down 20%), September was the second consecutive month of solid year-over-year growth. September exports totalled 9,715 tonnes (up 19%) valued at (US$59.5 million, up 17%).
Fuelled by strong growth in Indonesia and Vietnam, exports to the ASEAN region increased 18% to 17,797 tonnes, though value fell 5% to US$97.4 million. Exports to Indonesia are well-positioned for a strong finish in 2016 following the recent easing of import restrictions in an effort to address the tight beef supply situation.
Strong momentum continues for pork exports to Mexico
After a somewhat slow first half of the year, pork exports to Mexico moved higher in August and continued to climb in September, posting the second-largest monthly volume on record (66,567 tonnes, up 14% from a year ago). September value to Mexico was US$131.4 million, up 25% from a year ago and the highest since December 2014. For January through September, exports to Mexico pulled within 4% of last year's record pace in volume (510,737 tonnes) and moved 1% higher in value (US$939.7 million). USMEF's efforts to bolster pork demand in Mexico continue to pay dividends, as per capita pork consumption has increased nearly 20% since 2011 and now exceeds 40 pounds per year.
Another positive factor for pork exports to Mexico has been the slowdown in shipments to China / Hong Kong, where the product mix tends to be similar. While still well above last year, September exports to China / Hong Kong (36,184 tonnes, up 26%) were down significantly from the May peak of 58,000 tonnes, reflecting a rebound in China's domestic pork production. For January through September, exports to China / Hong Kong were up 70% from a year ago in volume (406,422 tonnes) and 57% higher in value (US$787.3 million).
While pork exports to Japan were below last year's pace in both volume (289,594 tonnes, down 8%) and value (US$1.16 billion, down 5%), higher-value chilled exports remain on a record pace, climbing 10% from a year ago to 164,087 tonnes. During periods of large US production, chilled exports to Japan provide an especially important outlet for loins and butts.
A rebound in South Korea's pork production led to a slow start for US exports in 2016, but exports to South Korea are poised for a strong finish as September results moved higher year-over-year for the second consecutive month. Compared to last year's large totals, January-September exports to the country were down 27% in volume (94,774 tonnes) and 33% in value (US$252.1 million).
Exports to Colombia have slowed in 2016 (24,851 tonnes, down 22%, valued at US$56 million, down 30%) due to a spike in domestic pork production and other headwinds, including the weak Colombian peso. But exports to Colombia rebounded in September, climbing 35% in volume (3,456 tonnes) and 29% in value (US$8.2 million).
Pork exports to Central America cooled in September but remain well above last year's pace in 2016, totalling 46,426 tonnes (up 16%) valued at US$110 million (up 11%). Exports were higher year-over-year in mainstay markets Honduras and Guatemala, and more than doubled to Nicaragua, as every Central American market except Belize is currently a top 20 volume destination for US pork.