US pork producers are receiving a positive return on their Checkoff investment in international markets through the US Meat Export Federation (USMEF), according to a study by Dr. Harry Kaiser, the Gellert Family Professor of Applied Economics and Management, at Cornell University.
The economic analysis of USMEF’s Export Market Development Programs was commissioned by USMEF to quantify the returns that the US Department of Agriculture’s Foreign Agriculture Service and the Pork Checkoff programs received from their investments in USMEF’s export market development programs. The study also quantified the contribution of USMEF’s programs to the growth in exports that has occurred over the past decade. Producer investments account for roughly 50 percent of USMEF’s expenditures on export promotion programs and the Foreign Agriculture Service funds account for the other half.
"It’s important to producers to understand and quantify the value of their investments," said Craig Christensen, chair of the Pork Checkoff’s Trade Committee and a producer from Ogden, Iowa. "The results indicated a positive impact of export market development and promotion on imports of US pork."
Specifically, the study found:
- An average annual increase in net pork industry revenue due to USMEF’s programs ranging from $39.9 million to $169.7 million.
- A contribution of 324 million lbs. per year to the growth of US Pork exports over the past 10 years and
- A median return-on-investment of dollars at $7.42 to $1.
The research was conducted using an economic model which utilised statistical procedures to help researchers account for the impact of a variety of factors that affected import demand, including price of imports of US pork, price of imports of pork from other countries, consumer income in importing countries, exchange rates and USMEF expenditures on pork export market development.
Eight importing regions, accounting for 82 percent of US Pork exports, were used in the model. Mexico, South Korea, Hong Kong, EU, Japan, Taiwan, China and Russia Mexico and Japan had the highest gains in imports due to export market development.
The USMEF has been performing market development activities in numerous markets since 1976, with the goal of increasing demand for US Pork by improving product image, increasing market presence, promoting total carcass utilization and providing trade support. Nearly 24 percent of US Pork and pork variety meat production was exported in 2010.