February exports of U.S. beef fell below last year’s levels while lamb exports trended higher, according to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF).
February beef exports declined 6 percent year over year to 94,885 metric tons (mt) while value was down 3 percent to $581.6 million. January-February exports were 3 percent below last year’s record pace in volume (199,651 mt) but steady in value at $1.22 billion. The volume decline is mainly due to lower exports to Hong Kong and Canada, as shipments to most other major beef markets have trended higher in 2019.
Beef export value per head of fed slaughter averaged $309.39 in February, down 4 percent from a year ago, while the January-February average was down 3 percent to $296.19. February exports accounted for 12.8 percent of total beef production and 10.1 percent for muscle cuts only, down from 13.6 percent and 10.8 percent, respectively, in February 2018. For January-February these ratios were 12.5 percent and 9.9 percent, each down one-half percentage point from the first two months of 2018.
USMEF President and CEO Dan Halstrom said there was much to be excited about regarding beef trade, “especially with the launch of U.S.-Japan trade agreement talks.”
“A great deal is at stake for both U.S. beef and U.S. pork in those negotiations, as exports to Japan deliver remarkable returns for the entire U.S. supply chain and it is essential that we get back on a level playing field with our competitors.”
Impressive growth for beef exports
Beef exports to leading market Japan remained strong in February, pushing January-February exports 8 percent above last year’s pace in volume (47,695 mt) and 10 percent higher in value ($309.3 million).
Frozen beef exports to Japan, primarily short plate and cuts in the clod/round category, rebounded from last year when frozen U.S. beef was still subject to Japan’s 50 percent snapback duty rate. Variety meat exports (mainly tongues and skirts) have also performed especially well in 2019, soaring 35 percent in volume (8,707 mt) and 29 percent in value ($58.9 million).
The competitive landscape continues to intensify in Japan however, especially as major competitors enjoyed another decrease in import duties on April 1. The duty rate for beef cuts from Australia, Canada, New Zealand, and Mexico dropped from 27.5 percent to 26.6 percent, while the U.S. rate remains at 38.5 percent. The duty rate for beef tongues and skirt meat from these competitors is now 5.7 percent, while the U.S. rate remains at 12.8 percent.
Following a record-shattering 2018, beef exports to Korea continue to push higher, though at a more moderate pace. January-February exports to Korea increased 7 percent in volume to 35,529 mt while value was up 11 percent to $261.7 million. U.S. beef continues to make strides in the Korean supermarket and foodservice sectors, driven by red-hot demand for U.S. steaks. Prepared U.S. beef products are also increasingly popular in a wide range of home meal replacement items.
Other January-February highlights for U.S. beef include:
• While beef exports to Mexico were steady with last year in volume (40,048 mt), value climbed 13 percent to $197.9 million. Beef muscle cuts achieved strong growth in both volume (24,434 mt, up 15 percent) and value ($155.5 million, up 19 percent).
• Exports to Taiwan were 3 percent ahead of last year’s record volume pace at 8,342 mt, but value slipped 6 percent to $73.7 million.
• Beef exports to Central America cooled in February but January-February exports to the region were still up 17 percent year over year in volume (2,357 mt) and increased 14 percent in value ($13.2 million), with growth driven mainly by Costa Rica and Honduras. Beef exports to the Dominican Republic have surged in 2019, climbing 87 percent in volume (1,470 mt) and 78 percent in value ($11.5 million).
• Africa has been a promising source of beef variety meat growth this year, with variety meat exports to South Africa (mainly livers) increasing 80 percent in volume (1,179 mt) and more than doubling in value ($1.1 million, up 113 percent). Variety meat exports were also sharply higher to Gabon, increasing 311 percent in volume (739 mt) and 157 percent in value ($529,000).
• As noted above, a slow start to 2019 in Hong Kong and Canada partially offset solid growth in other markets. Exports to Hong Kong fell 40 percent to 13,712 mt, valued at $110.4 million (down 35 percent). Exports to Canada were down 15 percent in volume (15,908 mt) and dropped 13 percent in value to just under $100 million.
Lamb exports gain momentum
U.S. lamb exports continued to trend higher in February, driven by muscle cut growth to the Caribbean, Mexico, Panama and Saudi Arabia and strong variety meat demand in Mexico and Canada. February exports of U.S. lamb totaled 1,361 mt, up 51 percent from a year ago. Export value was $2.43 million, up 31 percent. For muscle cuts only, exports climbed 17 percent from a year ago in volume (244 mt) and 31 percent in value ($1.55 million).
Through February, lamb exports were 67 percent ahead of last year’s pace in volume (2,745 mt) and 37 percent higher in value ($4.57 million). Muscle cut exports were up 46 percent in volume (488 mt) and 38 percent in value ($2.72 million). — USMEF
