February Meat Exports About Steady; Value Dips

February US red meat exports were about steady with last year, but their values moved lower, according to USDA statistics compiled by the US Meat Export Federation.

The USMEF said in a release that the lower prices reflect more abundant red meat supplies and a fiercely competitive international market.

February beef and variety meat exports totaled 83,203 tonnes, up only 212 tonnes, or 0.26%, from 82,991 last year.  The value of these exports, however, dropped 18.4%, or $98.331 million, to $436.980 million from $535.311 million a year ago.

Total January-through-February beef exports, at 165,504 tonnes, were up 2,614 tonnes, or 1.60%, from 162,890 tonnes a year ago but fell $163.809 million, or 16%, in value to $875.072 million from $1.039 billion in 2015.

However, a dip in February export tonnage is common.  USDA Economic Research Service and Foreign Agriculture Service historical data show the average 2010-through-2014 decline in beef and veal exports on a carcass weight basis to be 4.458 million pounds, or 2.43%.   Last year was unusual in that US beef and veal exports rose during the period.

 

THE OUTLOOK

 

From here, US beef and veal exports likely rose sharply in March, if they followed the seasonal norms.  They then are subject to a steady to lower shipments before rising to the annual peak sometime during the summer.

Last year, that annual peak occurred in June at 213.908 million pounds, compared with the previous five-year average of 239.513 million in July.

Beef and veal exports then have a strong tendency to decline into a September low.  Last year, this was 165.124 million pounds, well below the five-year average of 209.307 million.

Looking at the graph, it is easy to see that US beef exports were pressured last year, and that this pressure is continuing this year.  It’s very possible that this year’s total beef and veal exports will remain below last year as monthly totals fall short.

 

PORK EXPORT VALUE DOWN

 

Pork export volume in February was listed at 171,413 tonnes, down 2,358 tonnes, or 1.36% from 173,771 a year ago, while value fell $56.413 million, or 12.0% to $414.3 million from $470.7 million, the USMEF said.

For the first two months of the year, pork export volume remained 3,487 tonnes, or 1.04%, ahead of last year at 338,423 tonnes compared with 334,936 tonnes a year earlier.  However, the value was down $107.0 million, or 11.6%, to $819.1 million from $926.0 million.

Following the 2010-2014 trend, US pork exports likely will rise in March to the annual high.  The five-year average was 445,418 tonnes.  But last year, pork exports continued to rise into April where they peaked at 483,362 tonnes.

A fall rise in exports also has a strong seasonal tendency.  Typically, this begins in September, but last year, it began in August.  However, the peak tends to fall short of the spring high.

 

CASH CATTLE TRADE MIXED

 

Slaughter steer prices in the Southern Plains traded steady to $1 higher this week at mostly $133 per cwt up to $134 on a live basis.  On a dressed basis, cattle traded at $214 to $215 per cwt, down $1 to $2.

Cash cattle last week traded at $132 to $133 per cwt on a live basis and $214 to $216 on a dressed basis.  Both were down about $3 from the previous week.

The USDA’s choice cutout price Thursday was down $1.79 per cwt at $214.62, and select was off $1.64 at $205.79.  The choice/select spread narrowed to $8.83 from $8.98 as 159 loads of fabricated product were sold into the spot market.

The CME Feeder Cattle Index for the seven days ended Wednesday was $158.62 per cwt, up $0.83.  This compares with the Apr CME settlement Thursday of $154.15, up $0.97.