Beef producers and consumers often ask about beef trade, why we import and export? The simple answer is we are trying to receive the highest value for the product produced. The following facts might be helpful to understand the beef industry: the U.S. is the largest producer, largest consumer, fourth-largest exporter and the largest importer of beef in the world according to USDA/Foreign Agricultural Service.

U.S. Beef Exports

A large majority of beef exports would include high-quality cuts hence high value beef cuts as well as variety meats that have limited demand in the U.S. Figure 1 provides the volume of beef exported and imported reported in the Outlook for U.S. Agricultural Trade. The combined variety meats for beef and pork are a high portion of the volume of export products; however, the value of variety meat products does not match the value for beef and veal (Figure 2).

Variety cuts would include items such as tongue, heart, tripe, oxtail, and sweetbreads. When was the last time you purchased one of these variety meats? A couple of example of the value of exporting variety meats: 1) the price spread from exporting tongue has ranged between $3 to $12 per head (average tongue weigh 4 pounds), 2) beef liver exported has received $0.50 to $0.80 per pound or $10 to $16 per head (average beef liver weigh 20 pounds), and 3) omasum and abomasum (compartments of the ruminant animal’s stomach) exported has received $1 per pound. Many variety meats have limited or no value in the U.S., so the export market provides additional revenue for each carcass.

Beef is exported from the U.S. to numerous countries, the actual quantity, products and value fluctuates from year to year. However, the major countries the U.S. exports to according to the USDA Foreign Agricultural Service are Japan, Mexico, South Korea, Canada and Hong Kong.

Why import beef?

According to the USDA Foreign Agricultural Service, the U.S. is the largest producer of beef, so why import beef? The U.S. has a competitive fast food service industry with a high demand for hamburger. Ground beef production requires the addition of lean to mix with the trim from heifers and steers harvested in order to produce the ground beef product. Cull cows and bulls are a good source of lean product to incorporate with the trim; however, there is not enough of this lean meat produced in the U.S. Manufacturers could (and do) use some of the chuck and rounds, both lean cuts, to grind into hamburger. However, this is relatively expensive since roasts, value-added cuts (flat iron steak, Denver steak, and chuck eye steak) sell at a higher price than hamburger.

This demand for lean meat at a cost-efficient price leads to imports of the given product. A majority of the imported beef is lean beef that comes from Australian beef, New Zealand dairy beef, and cull cows from Canada.

The Bottom Line

Global marketing is a complex system that includes many agricultural products as well as non-agricultural products. Beef is only one of the many agricultural commodities traded and trade is an important tool as we strive for higher value U.S. beef.

Figure 1. U.S. beef exports and imports.

Source: Outlook Report from USDA’s Economic Research Service and Foreign Agricultural Service
 

Figure 2. Value of U.S. beef exports and imports.

Source: Outlook Report from USDA’s Economic Research Service and Foreign Agricultural Service


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