If the trend established in the first six months of the year holds up, U.S. beef and pork exports are likely to set several new records in 2011 and each could eclipse the $5 billion mark for the first time ever.
According to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF), June beef exports achieved the second-highest value ever at $461.8 million. This was 23 percent higher than June 2010, and has been surpassed only once – by the March 2011 value total of $475.2 million.
June pork exports were slightly higher in volume (165,786 metric tons) than last year and 6 percent higher in value ($451.2 million). This pushed first-half pork exports to 1.08 million metric tons valued at $2.81 billion – year-over-year increases of 14 percent and 19 percent, respectively. When compared to the all-time record year of 2008, the pace of this year’s pork exports is 6 percent higher in volume and 21 percent higher in value. For the first half of this year, pork exports accounted for more than 27 percent of total production with export value equal to $52.76 per head.
Pork exports to Korea tremendous; Japan shows steady growth
South Korea has taken bold measures in recent months to deal with its dwindling pork supplies and rising prices, and U.S. pork has been well-positioned to capitalize. With duty-free access on certain cuts and aggressive marketing programs firmly in place, U.S. pork exports to Korea reached 122,880 metric tons valued at $301.5 million. This represented a 145 percent increase in volume over the first half of last year, and nearly triple the value.
Coming off a record value year in 2010 of more than $1.6 billion, pork exports to Japan have increased another 10 percent in volume (249,417 metric tons) and 13 percent in value ($944.2 million) through the first half of this year. Exports to Canada have grown at a similar pace – achieving a 10 percent increase in volume (97,204 metric tons) and 12 percent growth in value ($335 million). The Hong Kong/China region – where access was limited in the early months of 2010 – was up 42 percent in volume (173,462 metric tons) and 30 percent in value ($260.5 million).
“The situation in Korea stems from some unfortunate circumstances, as its hog herd has been devastated by foot-and-mouth disease,” Seng said. “But it makes for an interesting case study for the remarkable growth we can achieve when we are not saddled with a 25 percent tariff – something our members of Congress need to consider as they debate the Korea-U.S. Free Trade Agreement. In addition, we’ve seen the market share for U.S. pork increase versus our competition under comparable access conditions.”
As for Japan, Seng noted that this market continues to generate amazing returns for U.S. pork producers. He remains hopeful that by December the U.S. will be challenging last year’s record value – which is a mark many people would have said was unthinkable just a few years ago.
Mexico, the largest volume destination for U.S. pork, saw exports fall by 3 percent in volume (260,858 metric tons) and hold steady in value ($484.9 million) compared to last year. U.S. ham and shoulder cuts were recently granted a tariff reduction (from 5 percent to 2.5 percent) as a result of a settlement in the NAFTA trucking dispute. These retaliatory tariffs are scheduled to be removed completely in the near future, which should help U.S. pork regain momentum in Mexico.
“Our pork results in Mexico are still solid, but I will be very pleased when these retaliatory tariffs are completely behind us,” Seng explained. “Canada is our chief competitor in this market, and these tariffs severely reduced our advantage in terms of transportation costs.”