FAS Sees Good Soybean, Pork Exports

Last week, the USDA’s Foreign Agricultural Service released its “2019 US Agricultural Export Yearbook” that provided a statistical summary of US agricultural commodity exports to the world and the US’ primary trading partners.

With respect to China, the update indicated that, “In 2019, US agricultural exports to China totaled $13.8 billion, up from $9.1 billion in 2018.  China was the third largest market for US agricultural exports.”

During 2019, the largest export increases were seen in soybeans and pork and pork products, up $4.9 billion and $729 million, respectively, the FAS said.

“China’s expedience and efficacy in removing structural barriers to US agricultural products and its willingness to lower or waive import tariffs will drive China’s progress toward meeting its food and agricultural purchase commitments, valued at roughly $80 billion over the next two years,” the FAS said.

“At the same time, various human, animal, and plant diseases and pests will each impact Chinese demand for food and agricultural products and thereby affect US agricultural export prospects in 2020,” the FAS said.  “The outbreak of COVID-19 and subsequent disease mitigation measures create substantial uncertainty for the Chinese and global economies.  Disruptions to the free movement of people and goods limit Chinese port and internal logistics capacity and hamper the ability of US producers to market their products in China.”




“China’s on-going battle against African Swine Fever is expected to keep China’s pork prices at record highs and drive demand for imports,” the FAS said.

“Similarly, in early 2020, China reported several outbreaks of highly pathogenic avian influenza.  These diseases continue to add uncertainty and to impact China’s meat and poultry prices and demand unevenly, while also affecting the livestock industry’s demand for US animal feed ingredients, such as soybeans.

“At the same time, China faces a fast-spreading plant pest problem as fall armyworm, predominantly a corn pest, reaches farms across the country,” the FAS said.  “China’s response to this plant pest will impact grain supply, demand, and trade.”




As for soybean exports, FAS stated that, “In 2019, the value of US soybean exports to the world reached $18.7 billion, up 19% in value from the prior year and up 13% in volume.  A substantial increase in exports to China offset declining exports to other major markets.

“However, US exports to China were still 3 million metric tons below 2017 levels, FAS said.  Despite year-on-year export growth in 2019, the total value of US soybean exports was 14% below the five-year average of 2013-2017.”

US soybean exports were forecast to be higher for the 2019-20 marketing year, the FAS update said.

US exporters could see increased soybean demand from China, where total imports were forecast to be 6% higher by volume.

However, Chinese demand will depend on expansion in China’s livestock and poultry production with the swine sector still hampered by recovery from ASF, and US sales will depend on the availability of exemptions from tariffs and compliance with the Phase 1 trade agreement.




Fed cattle trading was reported this week at $97 to $97.50 per cwt on a live basis, up $2 to down $2.50 from last week.  Dressed-basis trading was at $160 per cwt, up $2.

The USDA choice cutout Wednesday was down $1.85 per cwt at $201.11, while select was up $1.17 at $189.49.  The choice/select spread narrowed to $11.62 from $14.64 with 127 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Tuesday was $139.83 per cwt, up $0.06.  This compares with Wednesday’s Aug contract settlement of $141.97, up $1.27.