Momentum continues for U.S. pork exports; beef exports rebound

U.S. pork exports increase 8% in November, while beef exports decrease 1%.

U.S. pork exports continued to gain momentum in November, while beef exports also showed signs of a rebound, according to data released by the U.S. Department of Agriculture and compiled by the U.S. Meat Export Federation (USMEF).

November exports of U.S. pork increased 8% from a year ago to 181,678 metric tons, the largest volume since May. Pork export value was $452.6 million, down 13% from a year ago but up slightly from October. As has been the case in recent months, pork muscle cut export volume was up significantly year over year — rising 19% to 148,740 mt — while variety meat exports declined 23% to 32,938 mt. USMEF noted that year-over-year comparisons for pork variety meat may not be entirely accurate due to issues with 2014 data for Japan.

For the first 11 months of 2015 versus the same year-ago period, pork exports were down 3% in volume to 1.94 million mt and decreased 17% in value to $5.11 billion. January-to-November exports accounted for 24% of total production and 21% for muscle cuts only – down from 27% and 22%, respectively, in 2014. Export value per head slaughtered averaged $48.61, down 23% on the year.

November beef exports totaled 95,799 mt, down 1% from a year ago but the largest volume since June, while export value fell 17% to $519.7 million. For January through November, beef exports were down 11% from a year ago in both volume (973,028 mt) and value ($5.8 billion). January-to-November exports accounted for 13% of total production and 10% for muscle cuts only – each down 1% from a year ago. The export value per head of fed slaughter averaged $279.12, down 6% year over year.

“November offered some encouraging signs for U.S. meat exports, though the results were certainly not at the levels we would like to see,” USMEF president and chief executive officer Philip Seng said. “Despite the weak peso, Mexico continues to be a very strong performer for U.S. pork, and our beef exports to Mexico have also held up fairly well. Exports to most Asian markets are showing upward momentum, but clearly, the need to defend and expand our market share in Japan has never been greater.”

Pork exports

November pork exports to Mexico reached 61,275 mt, up 15% year over year and the third time in 2015 that monthly export volume topped 60,000 mt. With January-to-November exports up 5% to 650,839 mt, the export volume to Mexico is on pace to set a new record for the fourth consecutive year, USMEF said. Export value was down 20% to $1.15 billion, reflecting lower U.S. prices, but the Mexican peso was down an average of 16% in 2015, largely offsetting any break in pork prices for Mexican customers.

With several U.S. pork plants regaining eligibility to ship to China near the beginning of November, exports to the China/Hong Kong region were the largest of 2015, at 33,462 mt, valued at $65.6 million. While trailing the performance of 2011-13, these results still were up 41% in volume and 9% in value from November 2014. For January through November, exports to China/Hong Kong were down 2% in volume to 305,365 mt and down 11% in value to $632.9 million compared to a year ago. With strong growth from the European Union, China/Hong Kong’s total imports through November reached 1.7 mmt, up 7% from a year ago and on pace for a new record.

After cooling, to some degree, in the previous two months, November pork exports to South Korea reached 13,172 mt – the largest volume since May and up 5% year over year. For the first 11 months of 2015, exports to Korea were up 27% in volume to 153,421 mt and up 11% in value to $433.8 million. Korea’s imports from all suppliers were up 28% to nearly 450,000 mt, with U.S. market share holding fairly steady at 32%.

Exports to leading value market Japan continued to struggle in November, pushing the 11-month total down 13% on the year in volume to 374,720 mt and down 18% in value to $1.46 billion. While demand for U.S. chilled pork has rebounded in Japan, these gains have been offset by lower volumes of frozen pork and seasoned ground pork. With increased competition from the EU, the U.S. market share dipped to 39% in 2015, down from 44% in 2013. However, USMEF reported that Japan’s frozen inventories of imported pork recently fell 26% below the previous year’s large volume, indicating potential for import growth in 2016.

Beef exports

The U.S. beef export volume in November increased to several key Asian markets, including:

· Exports to Korea increased 8% in volume (11,950 mt) over the year, while value fell 21% to $69.4 million. For January through November, exports were up 7% in volume to 114,869 mt but fell 3% in value to $741.1 million. Korea’s imports of chilled U.S. beef were up 40 % through November, with the U.S. gaining 6% market share to reach 30.6%.

· Export volume to Hong Kong was the largest of 2015, at 14,478 mt, up 2%, but value fell 30% to $79.6 million. For January through November, exports to Hong Kong were down 22% in volume to 106,876 mt and 29% in value to $720.7 million.

· Exports to Taiwan rose 16% in volume to 2,685 mt and 13% in value to $25 million. January-to-November exports were up 4% in volume to 32,175 mt and up 10% in value to $290.3 million. U.S. beef dominates Taiwan’s chilled imports, with a 66% market share.

· Export volume to the Philippines surged 192% to 1,401 mt and increased 35% in value to $5.4 million. January-to-November exports were up 5% in volume to 11,868 mt and 11% in value to $60.3 million.

Japan was the notable exception to the positive November trend, with exports declining 21% in volume to 14,515 mt and 31% in value to $94.4 million. Through the first 11 months of the year, export volume to Japan fell 15% to 190,751 mt. Although Japan is still the leading value market for U.S. beef, the export value declined 19% to $1.19 billion. Japan imported less beef from all suppliers in 2015 and still has large frozen inventories of imported beef weighing on the market. However, the U.S. lost market share to Australia in 2015, with the U.S. share dropping from 38% to 35%. This was due, in part, to Australia’s 10% tariff advantage following implementation of the Japan-Australia Economic Partnership Agreement in January 2015, USMEF noted.

November beef exports to leading volume market Mexico increased 3% year over year to 19,582 mt, while value dipped slightly to $86.9 million. For January through November, exports to Mexico were down 8% in volume to 201,046 mt and 5% in value to $994.5 million. November exports to Egypt, a key market for beef livers and other variety meats, increased 33% in volume to 10,700 mt and 25% in value to $14.4 million. Through the first 11 months of 2015, exports to Egypt were down 14% in volume to 96,867 mt but increased 5% in value to $143.1 million.

Looking at 2016, USMEF said it sees opportunities for U.S. beef and pork to regain market share, with larger U.S. production and improved market access in some key regions. However, the competitive landscape remains very intense, the group added.

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