Export Demand Growing For US Meats

The latest available trade data for red meat, poultry and dairy show that foreign demand for these products accounts for a significant share of US animal products production, according to the USDA’s Livestock, Dairy and Poultry Outlook Wednesday.

 

2017 BEEF EXPORTS SEEN STRONG

 

Last year, beef exports accounted for 10.1% of commercial production, the report said.  Asia was the largest export market for beef, claiming 63% of total exports.

Total beef exports for December reached 254 million pounds, 30% more than 178 million a year earlier, the USDA said.  Following weak 2015 beef exports, sales to Japan, South Korea and Taiwan helped US beef exports recover to 2.55 billion pounds in 2016.

Preliminary data suggests higher near-term exports, the USDA said.  And, with expected higher US beef supplies and more competitive prices, this demand likely will support an expanded export market this year, possibly to 2.72 billion pounds.

US beef imports this year were projected to continue declining, likely to around 2.745 billion pounds from about 3.016 billion, because of an expected increase in domestic supplies and forecasts for tighter supplies in other exporting countries, the USDA said.

Total live cattle imports last year were reported at 1.71 million head, down nearly 14% from 2015’s 1.95 million.  Since the 2014 highs, cattle imports from Canada and Mexico were projected to decline for a third straight year to 1.68 million head.

Last year, higher US cattle inventories and a decline in feeder cattle prices contributed to the decline in imports of feeder cattle from Canada and Mexico, the USDA said.  Mexico also continues to finish more cattle in their own feedlots, selling increasing amounts of beef to the US and the rest of the world.

 

US PORK EXPORTS SEEN HIGHER

 

In 2016, 21% of US pork production was exported (5.2 billion pounds), with 45% going to Asia and 31% going to Mexico, the USDA said.  Exports this year were expected to be about 5.4 billion pounds, an increase of about 4%.  Pork exports last year were about 4.5% above 2015.

The USDA credited a late surge in pork demand last year coupled with restrained production in December and January to take current hog prices higher than was expected.  The 2016 cutout finished almost 18% higher than a year earlier.

December pork exports, at 493 million pounds, were more than 15% higher than a year earlier, the USDA said.  Fourth-quarter exports of 1.5 billion pounds were 14% higher than the same period in 2015, and for the year, total pork exports were 5.2 billion pounds, 4.5% more than 2015.

 

CASH CATTLE TRADE WEAKER

 

Average fed cattle exchange auction prices Wednesday were $1.36 per cwt higher at $119.02, versus $117.66 a week earlier.  However, only one trade was not from the Southern Plains where cattle sold last week at $120.21, and unsold cattle this week were from the north and were priced at $116 to $117.  Thus, in reality the market traded about $1.19 lower.

No cash cattle trading was reported subsequent to the auction results but traded last week at $119 to $120.50, mostly $119.75 to $120.50, on a live basis, up $0.50 to $0.75.  Dressed-basis trading was at $190 to $190.50, steady to up $0.50.

The USDA’s choice cutout Wednesday was down $0.02 per cwt at $188.34, while select was off $0.10 at $187.15.  The choice/select spread widened to $1.19 from $1.11 with 121 loads of fabricated product sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Tuesday was $128.43 per cwt, down $0.03.  This compares with Wednesday’s Mar settlement of $124.27, up $0.27.