LIVESTOCK MARKETS: November pork exports set new record

Asian markets shine for U.S. beef in November.

Krissa Welshans 1, Feedstuffs Editor

January 13, 2017

7 Min Read
LIVESTOCK MARKETS: November pork exports set new record

U.S. red meat exports continued to build momentum in November, highlighted by a new monthly volume record for pork exports. Pork and beef exports exceeded year-ago levels by more than 20% in both volume and value, according to statistics released by the U.S. Department of Agriculture and compiled by the U.S. Meat Export Federation (USMEF).

November pork exports totaled 225,757 metric tons, up 24% year over year and breaking the previous record of 218,132 m) set in October 2012. Export value was $586.8 million, up 30% from a year ago and the highest since May 2014. For January through November, pork export volume was up 7% from a year ago to 2.09 million mt, while export value increased 5% to $5.38 billion.

Even with U.S. pork production reaching record levels, USMEF said exports are accounting for a larger share. November export volume equated to 28% of total production and 23% for muscle cuts only – substantial increases over the November 2015 ratios of 24% and 21%. For January through November, exports accounted for 25.5% of total production and 21.4% for muscle cuts – up from 24.2% and 20.9%, respectively, in 2015. November export value averaged $55.09 per head slaughtered, up 19% year over year. The January-to-November average was $49.63 per head, up 2%.

November was also a very strong month for beef exports, which totaled 155,335 mt – up 20% year over year and the largest since July 2013. Export value increased 21% to $619.1 million, the highest since December 2014. This pushed January-to-November export volume to 1.07 mmt (up 10% year over year) with a value of $5.72 billion (down 1%).

November exports accounted for nearly 15% of total beef production and 11.7% for muscle cuts only – the highest levels since 2014. January-to-November exports accounted for 13.5% and 10.3% – up from 13% and 10%, respectively, during the same period in 2015. Beef export value per head of fed slaughter reached a 2016 high of $294.39 in November, up 5% from a year ago. For January through November, export value per head averaged $258.48, down 7%.

“With recent increases in both pork and beef production, the U.S. industry faces a significant challenge in terms of moving these larger supplies, but with aggressive and well-targeted international marketing efforts, this also presents an outstanding opportunity to grow our market share in established export destinations and cultivate new opportunities in emerging markets,” USMEF president and chief executive officer Philip Seng said. "U.S. exports are achieving success on both fronts, and USMEF is committed to keeping this strong momentum going in the new year.”

Mexico a powerful pacesetter for U.S. pork

Demand for U.S. pork gained further momentum in Mexico in November, where a fifth consecutive record year for export volume is now within reach, USMEF reported. November exports totaled 73,984 mt, up 21% year over year and pushing January-to-November volume to 649,992 mt, nearly even with the record pace of 2015. Export value was up 32% in November to $139.2 million, and January-to-November export value increased 4% to $1.19 billion.

Although still lower year over year, USMEF said pork exports to Japan, the leading value market, continued to strengthen in November, increasing 24% from a year ago in volume to 37,317 mt and up 35% in value to $153.4 million -- the highest since April 2015. Through November, export volume to Japan was down 5% to 357,808 mt, while the export value of $1.44 billion pulled within 1% of the previous year’s pace. 2016 will be a record year for chilled pork exports to Japan, which were up 10% through November to 201,828 mt.

Other highlights for U.S. pork included:

  • While pork muscle cut exports to China/Hong Kong continued to moderate, pork variety meat demand remains very strong. In November, pork variety meat exports to the region increased versus a year ago by more than 90% in volume to 32,398 mt and more than doubled in value to $69.9 million. Through November, pork variety meat exports were up 60% in volume to 281,273 mt and 51% in value to $569 million, while combined pork and pork variety meat exports rose 63% to 497,701 mt and were up 55% in valued to $978.9 million.

  • Pork exports to Central and South America increased 7% in volume through November to 120,502 mt, valued at $297.4 million, up 5%. Year-over-year increases were achieved in all seven Central American countries, led by mainstay markets Honduras and Guatemala, as well as in Chile. After a difficult first half, USMEF said exports to Colombia have rebounded significantly in the past four months and are now just below their 2015 pace.

  • January-to-November exports to Canada were up 2% from a year ago in both volume (186,724 mt) and value ($731 million). This included a 13% increase in pork variety meat volume to 12,451 mt at a value of $17.8 million, up 5%.

  • Larger exports to both Australia and New Zealand pushed January-to-November exports to the Oceania region up 9% year over year in volume (63,653 mt) and up 2% in value ($179.6 million).

Asian markets shine for U.S. beef

Following a down year in 2015, U.S. beef exports to Japan continued to stage a very impressive rebound, according to USMEF. November exports to Japan surged by 63% in volume to 23,598 mt and rose 58% in value to $149.5 million versus a year ago. For January through November, export volume increased 24% to 237,234 mt. This included a 44% increase in chilled exports to 102,090 mt. January-to-November export value to Japan increased 16% to $1.39 billion.

Beef exports to South Korea have already set a new value record of $929.3 million, up 25% and breaking last year’s mark of $847.4 million in just 11 months. When 2016 results are final, Korea will become the fifth market (joining Japan, Mexico, Hong Kong and Canada) in which U.S. exports have exceeded $1 billion in a single year. January-to-November export volume to Korea was 158,947 mt, up 38% year over year. This included a 37% increase in chilled beef exports to 20,325 mt.

Other highlights for U.S. beef exports include:

  • November was another very strong month for beef exports to Taiwan, pushing January-to-November results 22% above of the 2015 pace in volume to 39,299 mt with a 10% higher value of $319.5 million – already setting a new full-year value record.

  • Fueled by a resurgence in shipments to Indonesia, January-to-November beef exports to the Association of Southeast Asian Nations region increased 32% in volume to 26,003 mt and 8% in value to $138.6 million. Exports also posted impressive gains in Vietnam, helping offset lower exports to the Philippines.

  • Beef exports to Mexico continued to strengthen in volume, which was up 8% through November to 217,790 mt. Export value to Mexico was down 10% to $891.1 million.

  • Beef variety meat exports increased 10% from a year ago in volume to 308,712 mt through November and 4% in value to $820.7 million. USMEF said this performance was bolstered by the addition of Indonesia, which reopened to beef variety meat in August, and South Africa, which was closed to all U.S. beef products until last January. “Both are now top 10 volume markets for beef variety meat,” USMEF added.

Market recap

The December fed cattle futures market was mostly lower this week after a long holiday weekend. Nearby contracts closed lower Tuesday at $114.875/cwt., then posted gains Wednesday but closed lower again Thursday at $115.075/cwt.

January feeder cattle futures were lower this week. Nearby contracts closed lower Tuesday and Thursday at $130.20/cwt. and $128.25/cwt.

For the beef cutouts this week, Choice and Select were lower at $201.52/cwt. and $193.39/cwt., respectively.

February lean hog futures started the week lower but climbed during the week. Nearby contracts closed lower Tuesday at $63.50/cwt. but closed higher Thursday at $64.875/cwt.

Pork cutout values were higher this week. The wholesale pork cutout was higher at $79.57/cwt. Loins were higher at $80.75/cwt. Hams and bellies were also higher at $62.02/cwt. and $118.16/cwt.

Hogs delivered to the western Corn Belt were higher this week, closing at $54.08/cwt. on Thursday.

USDA reported the Eastern Region whole broiler/fryer weighted average price at 85.54 cents/lb. on Dec. 30.

According to USDA, egg prices have been steady, with a lower to sharply lower undertone. Offerings and supplies have been moderate to heavy. Demand has been mostly light to moderate.

Large eggs delivered to the Northeast were unchanged at $1.10-1.14/doz. Prices in the Southeast and Midwest were higher at $1.21-1.24/doz. and $1.10-1.13/doz., respectively. Large eggs delivered to California were unchanged at $1.66/doz.

For turkeys, USDA said the market was steady to weak, with light to moderate offerings. Demand has been light. Prices were lower, at $1.00-1.02/lb. for both hens and toms.

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