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October another stellar month for U.S. red meat exports

October a record month for pork exports to South America.

U.S. pork exports remained ahead of last year’s record volume pace, and beef exports are poised to break $7 billion this year for only the second time, according to October export results released by the U.S. Department of Agriculture and compiled by the U.S. Meat Export Federation (USMEF).

October pork exports were the largest since May, totaling 211,592 metric tons (mt), up 5% from a year ago and valued at $565.4 million, up 8%. USMEF noted that pork exports through the first 10 months of the year increased 8% in volume to 2.005 million mt and 10% in value to $5.28 billion from the same period last year.

Exports accounted for 25.4% of total pork production in October, steady with last year, and 21.6% for muscle cuts only, up slightly from a year ago. For January through October, these ratios increased about 1% from a year ago to 26.4% of total production and 22% for muscle cuts. October export value averaged $51.41 per head slaughtered, up 9% from a year ago and the highest since July. Through the first 10 months of the year, per-head export value was $52.64, up 7%.

According to the data, beef exports reached 111,287 mt in October, a 5% increase from a year ago, and value reached $662 million, an 18% increase. USMEF said these were the second-largest monthly totals of 2017, trailing only August. For January through October, exports were up 9% year over year to 1.038 million mt and were valued at $5.93 billion – up 16% from a year ago and slightly ahead of the record value pace established in 2014.

USMEF reported that beef exports accounted for 13% of total U.S. production in October, the highest since July but down from 13.9% last year. The percentage of muscle cuts exported was steady with last year at 10.7%. For January through October, beef exports accounted for 12.8% of total production — 13.3% below last year — and 10.2% for muscle cuts — steady with last year.

October beef export value averaged $301.88 per head of fed slaughter, up 12% from a year ago and the highest since December 2016. January-to-October export value averaged $279.85 per head, up 10%.

Pork exports rebound to Mexico, Japan, set monthly record for South America

Following a modest slowdown in September, pork exports to leading volume market Mexico regained momentum at 69,529 mt, up 7% from a year ago, valued at $129.8 million, up 13%. Through October, USMEF said exports to Mexico are well-positioned for a sixth consecutive annual volume record at 655,527 mt, up 14%, valued at $1.24 billion, up 17%.

Mexico is an especially important destination for U.S. hams, and consumption growth in Mexico has been critically supportive of ham prices in this time of record U.S. pork production, USMEF president and chief executive officer Dan Halstrom explained.

“Although ham prices are currently below last year’s level, they have been up an average of 2 % in 2017, and predictions of ham prices plummeting have not come true," he said. “Strong demand in Mexico is absolutely a key reason for this. USMEF has focused on expanding per-capita pork consumption in Mexico, which is up by about one-third in the past 10 years. This has helped make Mexico an even more critical and more reliable trading partner for the U.S. pork industry.”

Exports to leading value market Japan also trended upward in October, increasing 5% from a year ago in both volume to 32,475 mt and value to $134.5 million, USMEF reported. January-to-October exports to Japan were up 1% to 322,422 mt,  and valued climbed 3% to $1.33 billion. This included 176,609 mt of chilled pork valued at $834 million, down 2% in volume but up 2% in value versus a year ago.

Led by Colombia and Chile, USMEF said October pork exports to South America reached a record 12,624 mt, a 31% increase from a year ago, valued at $32.3 million, a 29% increase. Through October, exports to South America were 78% ahead of last year’s pace in both volume, at 85,175 mt, and value, at $218.8 million — already surpassing the previous records set in 2014, USMEF said. Export volumes to Colombia and Chile have also exceeded previous highs reached in 2014 and 2013, respectively.

According to USMEF, other January-to-October results for U.S. pork exports include:

  • Exports to South Korea, having gained further momentum in October, have already exceeded their full-year 2016 totals in both volume, at 136,041 mt, and value, at $372.7 million. Compared to the first 10 months of last year, exports were up 27% and 30%, respectively.
  • Led by mainstay markets Honduras and Guatemala, exports to Central America are on a record pace, totaling 56,906 mt, up 7% year over year, valued at $138.4 million, up 9%. Exports also increased substantially to El Salvador and Nicaragua and edged slightly higher to Costa Rica.
  • Exports to the Dominican Republic are also on a record pace, rising 26% year over year in volume to 26,476 mt and up 32% in value to $60.6 million.
  • Despite trending lower in October, pork exports to the Association of Southeast Asian Nations (ASEAN) region were still 16% ahead of last year’s pace in volume at 39,910 mt and 31% higher in value at $109.2 million, led by strong performances in the Philippines, Singapore and Vietnam.
  • October exports to China/Hong Kong were below last year’s volume but were steady in value, reflecting the upward trajectory of China’s domestic pork production. Through October, exports to the region dropped 8% from a year ago in volume to 413,032 mt but were just 1% lower in value at $872.8 million as continued strong demand for variety meats largely offset the slowdown in muscle cut exports.

Japan, Korea, Hong Kong drive outstanding growth

USMEF reported that Japan continued to be the pacesetter for U.S. beef exports in October, with volume climbing 19% from a year ago to 23,981 mt and value up 23% to $147.1 million. This pushed January-to-October volume to 260,517 mt, up 22%, valued at $1.59 billion, up 29% and already setting a new single-year record. Chilled beef continues to drive export growth to Japan, with chilled exports up 40% in volume to 124,699 mt and 43% in value to $918.8 million.

“The U.S. beef industry has really broadened its reach in Japan, expanding the range of cuts offered and the retail and foodservice venues in which they are featured, but USMEF remains concerned about market access barriers in Japan as we face significantly higher tariffs than our main competitor, Australia, and import safeguards that could hinder further growth,” Halstrom said.

Exports to South Korea continued to climb in October, up 2% in volume to 17,224 mt and up 24% in value to $122.4 million versus a year ago. Through October, exports totaled 148,998 mt, up 7%, with value at $979.3 million, 20% above last year’s record pace. Demand for U.S. chilled beef is especially strong in Korea’s retail sector, with chilled beef exports up 88% to 36,773 mt and value up 93% to $329 million.

Other January-to-October highlights for U.S. beef exports include:

  • Despite a slow start in 2017, exports to Hong Kong climbed 12% from a year ago in volume to 97,334 mt and were 23% higher in value at $646.1 million. Since the mid-June market reopening, exports to China have totaled 1,570 mt, with a value of $17.2 million.
  • While beef exports to Taiwan slowed in October, 10-month results remained 4% ahead of last year’s pace at 36,719 mt, valued at $335.6 million, up 18%. With a strong finish, Taiwan will easily top last year’s value record of $362.8 million.
  • Led by strong increases in Indonesia and Vietnam, beef exports to the ASEAN region increased 57% in volume to 34,777 mt and 46% in value to $173.5 million. Exports to the Philippines were also higher year over year.
  • A bounce-back year in Peru and strong demand in Chile and Colombia have beef exports to South America on a record pace. Exports increased 27% from a year ago in volume to 24,236 mt and rose 23% in value to $93.3 million.
  • Beef exports within North America have remained solid in 2017, with shipments to Mexico increasing slightly from last year in both volume to 196,604 mt and in value to $813.3 million. Exports to Canada increased 4% in volume to 96,401 mt and 7% in value to $667 million.
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