Source: Susan Kelly, MEATINGPLACE, 7/10/18



U.S. beef exports set a new value record in May while also increasing significantly from a year ago in volume, according to USDA data compiled by the U.S. Meat Export Federation (USMEF).

May pork exports were lower than a year ago. Though January-to-May totals for U.S. pork remained ahead of last year’s record pace, they will be tested in coming months by higher tariffs, USMEF said.

Beef
Beef export volume was 117,871 metric tons in May, the sixth-largest on record, valued at $722.1 million, which surpassed the previous monthly high in March 2018 by 4 percent and was 24 percent higher than a year ago. Through the first five months of 2018, beef exports were up 10 percent in volume to 547,157 metric tons, while export value was $3.32 billion, 21 percent above last year’s record pace.

Exports accounted for 13.6 percent of total beef production in May, up from 13 percent a year ago. Japan and South Korea continue to be the pacesetters for U.S. beef export growth.

Pork
Following a record performance in April, May pork export volume was 217,209 metric tons, down 2 percent from a year ago and reflecting smaller exports of variety meats. Export value was $562.5 million, down 3.5 percent. For January through May, pork export volume was still 3 percent ahead of last year’s record pace at 1.08 million metric tons, while value increased 6 percent to $2.85 billion.

Exports accounted for 27.8 percent of total pork production in May, down from 29.5 percent a year ago.
Tariff impact

Mexico’s retaliatory duties on U.S. pork took effect in June, so January-May results were not directly impacted. May exports to Mexico increased 3 percent from a year ago in volume but slipped 11 percent in value. Through the first five months of 2018, exports to Mexico were 6 percent above last year’s record volume pace, with value up 2 percent.

On June 5, Mexico imposed a 10 percent duty on fresh/frozen pork muscle cuts from the United States, and the rate increased to 20 percent on July 5. Also in June, Mexico imposed a 15 percent duty on U.S. pork sausages and a 20 percent duty on some prepared hams (these rates did not increase July 5) and opened a duty-free quota aimed at attracting imports from non-U.S. suppliers.

Pork exports to the China/Hong Kong region were well below year-ago levels in May, due in part to the additional 25 percent tariff imposed by China on April 2 (the increase does not apply to product entering Hong Kong). May exports to China/Hong Kong were down 31 percent from a year ago, while export value dropped 25 percent. For January through May, exports to China/Hong Kong were 18 percent below last year’s pace in volume and down 6 percent in value.

Exports to China will face an even steeper challenge in the second half of 2018, as China recently hiked the duty rate on U.S. pork by another 25 percent, USMEF said. This means U.S. pork cuts and pork variety meat entering China now face a duty rate of 62 percent, compared to 12 percent for China’s other suppliers, including the European Union, Brazil and Canada.

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