In its latest report called Livestock and Poultry: World Markets and Trade, the USDA said global beef production was projected to expand to record levels in 2022 with increased production in Brazil, China, India, Australia and Mexico offsetting decreased production in the US, Canada, the EU and Argentina.
Derrell Peel, Oklahoma State University Extension Livestock Marketing Specialist, said in a letter to Extension agents called Cow-Calf Corner that Brazil was projected to be the largest beef exporting country again in 2022 with exports forecast to increase 12.1% year over year, accounting for 22% of global beef exports.
BRAZIL IN FOCUS
Brazil has been the largest beef exporting country for the last five years consecutively and the largest in 14 of last 20 after first becoming the largest exporting country in 2004.
After disruptions in 2021, Brazil resumed exporting beef to China/Hong Kong, Peel said. Exports to the US increased 131% in 2021 and were sharply higher thus far in 2022, following increased Brazilian market access for fresh product in early 2021.
However, Brazil will encounter sharply higher tariff rates in 2022 for exports to the US once the “other country” Tariff Rate Quota is met, he said.
The second tier of beef exporting countries are far behind Brazil, Peel said. The US, India and Australia are roughly the same sized exporters, but the latest USDA forecast called for the US to be the second largest beef exporting country for the second straight year this year, with total exports just 58% of Brazil.
US beef exports were expected to decline modestly from record 2021 levels but will remain historically high.
INDIA COMES OUT
India was forecast to be the third largest beef exporting country in 2022 with exports increasing year over year from 2021, Peel said. India was the largest global beef exporter from 2014-2016 but slowed and declined to a recent low in 2020 before recovering.
Production in India includes beef and meat from water buffalo (carabeef), he said.
Australia was forecast to be the fourth largest beef exporting country in 2022, Peel said. Australian beef production dropped to the lowest level more than two decades in 2021 as the industry began to rebuild from several years of drought-forced liquidation.
Australia’s beef exports were forecast to increase 14.2% year over year in 2022 and accounted for 12.3% of US beef imports in 2021, the lowest on record, he said. This compares with an average share of nearly 29% for the prior 20 years.
The top four beef exporting countries represent about 60% of the 2022 projected global total in the USDA report, Peel said.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $141.82 to $142.00 per cwt, compared with last week’s range of $137.84 to $141.52. FOB dressed steers, and heifers went for $219.31 to $219.77 per cwt, versus $216.67 to $220.09.
The USDA choice cutout Monday was down $1.54 per cwt at $271.08, while select was up $0.56 at $259.46. The choice/select spread narrowed to $11.62 from $13.72 with 82 loads of fabricated product and 25 loads of trimmings and grinds sold into the spot market.
The USDA reported that basis bids for corn from feeders in the Southern Plains were up $0.05 at $1.50 to $1.60 a bushel over the May futures and for southwest Kansas were unchanged at $0.10 over May, which settled at $8.13 1/4 a bushel, up $0.23.
No live cattle contracts were tendered for delivery Monday.
The CME Feeder Cattle Index for the seven days ended Friday was $154.62 per cwt down $1.01. This compares with Monday’s Apr contract settlement $155.77, down $2.42.