Momentum Continued for U.S. Pork Exports in November; Beef Exports also Rebound

U.S. pork exports continued to gain momentum in November while beef exports also showed signs of a rebound, according to data released by USDA and compiled by USMEF.

November exports of U.S. pork were up 8 percent from a year ago to 181,678 metric tons (mt), the largest volume since May. Pork export value was $452.6 million, down 13 percent 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 (148,740 mt, up 19 percent) while variety meat exports declined 23 percent to 32,938 mt. (As USMEF has previously noted, 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, pork exports were down 3 percent from a year ago in volume to 1.94 million mt and 17 percent lower in value at $5.11 billion. January-November exports accounted for 24 percent of total production and 21 percent for muscle cuts only – down from 27 percent and 22 percent, respectively, in 2014. Export value per head slaughtered averaged $48.61, down 23 percent year-over-year.

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

Demand for U.S. pork remains strong in Mexico; exports to China continue to rebound

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

With several U.S. pork plants regaining eligibility for 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 2011-2013, these results were up 41 percent in volume and 9 percent in value from November 2014. For January through November, exports to China/Hong Kong remained 2 percent lower in volume (305,365 mt) than a year ago and were down 11 percent in value ($632.9 million). With strong growth from the European Union, China/Hong Kong’s total imports through November reached 1.7 million mt, up 7 percent 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 percent year-over-year. For the first 11 months of 2015, exports to Korea were up 27 percent in volume (153,421 mt) and 11 percent in value ($433.8 million). Korea’s imports from all suppliers were up 28 percent to nearly 450,000 mt, with U.S. market share holding fairly steady at 32 percent.

Exports to leading value market Japan continued to struggle in November, pushing the 11-month total down 13 percent year-over-year in volume (374,720 mt) and 18 percent lower in value ($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 ground seasoned pork. With increased competition from the European Union, U.S. market share dipped to 39 percent in 2015, down from 44 percent in 2013. However, Japan’s frozen inventories of imported pork recently fell 26 percent below the previous year’s large volume, indicating potential for import growth in 2016.

Beef exports gain momentum in most Asian markets, but decline continues in Japan

November beef export volume increased year-over-year to several key Asian markets, including:

• Exports to Korea increased 8 percent in volume (11,950 mt), while value fell 21 percent to $69.4 million. For January through November, exports were up 7 percent in volume (114,869 mt) but down 3 percent in value ($741.1 million). Korea’s imports of chilled U.S. beef were up 40 percent through November, with U.S. market share gaining 6 percentage points to 30.6 percent.
• Export volume to Hong Kong was the largest of 2015 at 14,478 mt, up 2 percent, but value fell 30 percent to $79.6 million. For January through November, exports to Hong Kong were down 22 percent in volume (106,876 mt) and 29 percent in value ($720.7 million).
• Taiwan was up 16 percent in volume (2,685 mt) and 13 percent in value ($25 million). January-November exports were up 4 percent in volume (32,175 mt) and 10 percent in value ($290.3 million). U.S. beef dominates Taiwan’s chilled imports, with 66 percent market share.
• Export volume to the Philippines surged 192 percent to 1,401 mt, and increased 35 percent in value ($5.4 million). January-November exports were up 5 percent in volume (11,868 mt) and 11 percent in value ($60.3 million).

Japan was the notable exception to the positive November trend, with exports declining 21 percent in volume to 14,515 mt and 31 percent in value to $94.4 million. Through the first 11 months of the year, export volume to Japan fell 15 percent to 190,751 mt. Although Japan is still the leading value market for U.S. beef, export value declined 19 percent 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. But the U.S. lost market share to Australia in 2015, with U.S. share dropping from 38 percent to 35 percent. This was due in part to Australia’s 10 percentage point tariff advantage following implementation of the Japan-Australia Economic Partnership Agreement in January 2015.

November beef exports to leading volume market Mexico increased 3 percent 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 percent in volume (201,046 mt) and 5 percent in value ($994.5 million). Exports to Egypt, a key market for beef livers and other variety meat, increased by 33 percent in volume (10,700 mt) and 25 percent in value ($14.4 million) in November. Through the first 11 months of 2015, exports to Egypt were down 14 percent in volume (96,867 mt) but increased 5 percent in value to $143.1 million.

“November offered some encouraging signs for U.S. meat exports, though the results were certainly not at the levels we would like to see,” said USMEF President and CEO Philip Seng. “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.”

Looking ahead to 2016, USMEF 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, but the competitive landscape remains very intense.

Lamb export volume improves, but value still struggling

November exports of U.S. lamb jumped 12 percent year-over-year to 800 mt, though value was still down 31 percent to $1.44 million. January-November exports were down 13 percent in volume (8,385 mt) and 33 percent in value ($17.21 million) as gains in emerging markets such as Saudi Arabia, Oman and Costa Rica were offset by lower exports to Mexico and Canada.

Complete January-November export totals for U.S. beef, pork and lamb are available from USMEF’s statistics webpage.

For more information, please contact Joe Schuele at jschuele@usmef.org or 303-547-0030.

NOTES:

• Export statistics refer to both muscle cuts and variety meat unless otherwise noted.
• One metric ton (mt) = 2,204.622 pounds.
• *Excluding Japan, January-November pork variety meat exports were down 9 percent year-over-year to 364,868 mt. In 2014, some exports for Japan were miscoded as large intestines and the data has not yet been corrected, thus skewing the 2015 comparisons.