click image to zoom The sharp increase in US beef prices continues to take its toll on US beef export volume. The data for September showed total shipments of US fresh/frozen and processed beef and veal were down 12,305 MT or 16% compared to a year ago. This was the ninth consecutive month that US beef exports have posted a year over year decline. Limited beef supplies and the resulting high beef prices have negatively impacted US beef export volume. Export revenues, on the other hand, remain strong and were only modestly lower compared to last year despite the sharp decline in tonnage. The total value of beef and veal exports in September was pegged at $387.1 MM, down about 2.6% from last year. Year to date, the value of US beef and veal exports is reported to be $3.575 billion, up 1% from last year. Total beef and veal export volume so far this year is down 13% from a year ago. Beef exports were lower across the board. Mexico remains one of the top markets for US beef but it has shrunk considerably in recent years. A weak Peso, significant food price inflation and a weak economy have forced Mexican buyers to look for alternative meat protein supplies to beef. In September, shipments of US beef to Mexico were down 6,800 MT (-52%) from a year ago. The decline in exports to Mexico accounted for more than half of all the decline in US beef exports for the month. On the other, hand US pork exports to Mexico in September rose by almost 7,500 MT and chicken was up 10,000 MT. Indeed, it appears that for much of this year Mexican buyers have substituted more pork and chicken for beef. Year to date US beef exports to Mexico are 28,772 MT or 28% lower than year ago. However, exports of US pork to Mexico so far this year are up 47,250 or 17% from last year. US beef exports to Japan, which has been one of the few growth markets so far this year, were about steady compared to last year. Lack of product availability, especially for items that are of interest to the Japanese market such as chuck rolls and short plates, remains a concern. Cattle age limit restrictions remain one impediment for increasing shipments to the Japanese market, a limitation that is expected to be removed next year.
Pork shipments in September were about steady compared to last year despite a sharp decline in exports to China and Hong Kong. Total exports of US fresh/frozen and processed pork were 147.3 million pounds, only a few hundred metric ton (-0.4%) lower than a year ago. Exports to China and Hong Kong were down some 12,862 MT or –43% compared to a year. A good portion of this lost business was offset by higher exports to Mexico. However, the increase in exports to Mexico was largely a reflection of the much lower pork prices and the relative competitiveness of pork vs. beef. US pork exports to Russia and a number of smaller markets also helped offset the loss of Chinese business. Still, we expect overall US pork exports in Q4 to trend below year ago levels. Exports of fresh/frozen chicken in September were 275.4k MT, down about 9,484 MT or 3% compared to a year ago. Chicken exports to Mexico were up some 10,000 MT or 27% from a year ago, offsetting some of the decline in exports to Russia (-40%) and Hong Kong (-74%).