Lifting 30-month cattle age limit should fuel U.S. beef exports to Mexico.
THE Mexican government is in the process of making regulatory changes that will allow for the import of U.S. beef and beef products derived from cattle of any age.
This important development lifts the 30-month cattle age limit for U.S. beef and effectively removes the last of Mexico's restrictions related to bovine spongiform encephalopathy.
The changes to Mexico's import regulations were to take effect April 30, although shipments of over-30-month beef cannot begin until the U.S. Department of Agriculture's Food Safety & Inspection Service (FSIS) updates its Export Library, which is expected to be completed within a few days.
This will also allow the USDA Agricultural Marketing Service export verification program for Mexico — in which approximately 170 U.S. establishments currently are enrolled — to be terminated.
Chad Russell, U.S. Meat Export Federation (USMEF) regional director for Mexico, Central America and the Dominican Republic, said, "This is an issue that USMEF has been working on for a number of years, and resolving it has been a lengthy process. ... Though it took some time, these efforts have now paid off."
According to information provided to USMEF, Mexico will accept either a new or existing FSIS letterhead certificate, along with the corresponding FSIS form, for product currently in the pipeline and for new shipments made over the next few weeks. That will give exporters some time — likely until late June — to make the transition to the new letterhead certificate and other documentation requirements.
"This should have a positive impact on our ability to export more beef to this large and important market, particularly in the current environment," Russell explained. "We're experiencing a period of very high beef prices and constraints on supply in what has always been a rather price-sensitive market, so we feel that having new supply options available will help us maintain a strong presence in the market and grow our export volume to Mexico."
Despite concerns over rising beef prices and tight supplies, exports to Mexico have remained strong. U.S. beef and beef variety meat exports have been above year-ago volumes in each of the past nine months, and 2014 exports through February were up 26% in volume and 40% in value from the same period in 2013 (Figure).
The U.S. comprises about 90% of Mexico's imported beef market, with the remainder captured mostly by Canada.
Canada's market share has edged higher in recent months, which is likely due to increased affordability as its beef production has been recovering and the Canadian dollar has weakened. With the exception of livers, though, Canada's exports to Mexico are still limited to beef derived from cattle under 30 months of age.
"Mexico's domestic beef supplies have been shrinking due to the prolonged drought, and there are not a lot of other foreign suppliers serving the market, but that doesn't necessarily make it easy for the United States to grow our exports to Mexico," Russell said. "We need a reliable supply of beef cuts that are affordable for everyday Mexican consumers, and that's where elimination of these import restrictions is really going to be helpful."