China’s 2018 Beef, Poultry Import Forecast Seen Up

The USDA’s Foreign Agricultural Service has forecast China’s 2018 beef and broiler meat imports from the US are forecast to rise 11% and 7%, respectively.

However, in a report that was approved by the USDA’s World Outlook Board, the FAS said despite robust Chinese demand coupled with stagnant or declining production, additional growth in imports will be constrained by restrictions that limit supplies from the US, a key global trader.

In May, the US regained access to China’s beef market, allowing exports of fresh, chilled, frozen along with bone-in and deboned product, as well as some variety meats.  In the 13 years the US was banned from China’s markets because of Bovine Spongiform Encephalopathy, China transformed from an insignificant buyer into the world’s second-largest importer.

While opportunities exist for US beef exports to China, shipments likely will be constrained in the short term because of market requirements limiting exportable supplies.

China’s domestic beef industry has been unable to boost production at a pace necessary to meet rising demand.  As a result, beef imports have grown sharply since 2013, reaching 820,000 tonnes ($2.6 billion) in 2016.

From 2011 to 2016, China’s domestic beef production grew 8% to 7.0 million tonnes (carcass weight equivalent), but was outpaced by even stronger consumption growth, which rose 20% to 7.8 million tonnes during the same period.

China’s production is constrained by high costs, inadequate cold chain infrastructure, lack of investment and a fragmented industry of mostly small-scale producers located inland, which is challenged to service primary consumption centers in eastern China.

Unable to fully satisfy demand with domestic production, the country has increasingly looked to the international market.




The US currently is not eligible to export broiler meat to China because of highly pathogenic avian influenza restrictions.  (The World Organization for Animal Health declared the US HPAI-free as of Aug. 11, so further import restrictions soon may not be deemed necessary.)

Even though the US regained access to China’s beef market in May 2017, shipments are likely to be constrained in the short term by market requirements that limit the ability of the US to maximize trade opportunities, the FAS said.  China is the world’s second and seventh largest beef and broiler meat importer, respectively, accounting for 13% and 5% of forecast trade.




Alternatively, China’s pork imports were forecast to decline for the second straight year in 2018 as domestic production gains reduce demand for imported pork.  The EU, US and Canada will remain the principal suppliers, competing primarily on price.

With relatively strong demand for processing, China’s pork imports were thought unlikely to retreat to past levels, maintaining China as the world’s top importer of pork accounting for nearly one-fifth of forecast trade.




Scattered trade came Tuesday in Nebraska at $117.50 to $118.50 per cwt on a live basis, down $1.50 to $3 from last week with more Wednesday at $118 and at $188 on a dressed basis, down $1 to $2.  However, more trade came Thursday at $117 live and $187 dressed, down $2 and down $2 to $3.

No trading took place on the Livestock Exchange video auction Wednesday.

The USDA’s choice cutout Thursday was down $1.32 per cwt at $205.08, while select was off $0.28 at $183.83.  The choice/select spread narrowed to $21.25 from $22.29 with 101 loads of fabricated product sold into the spot market.

The CME Feeder Cattle index for the seven days ended Wednesday was $155.01 per cwt, down $1.10.  This compares with Thursday’s Jan settlement at $146.32 per cwt, up $0.30.