U.S. pork and beef exports were at more-than year-ago levels in both volume and value in June, according to data released by the U.S. Department of Agriculture and compiled by the U.S. Meat Export Federation. Led by a rebound in Mexico and China, pork-export value was the best in 14 months, while strong results in South Korea and Taiwan pushed beef-export value to the fourth-best total on record.
June pork exports posted double-digit gains in both volume and value, reaching 212,887 metric tons. That’s an increase of 11 percent year-over-year, valued at $569.2 million. For the first half of 2019, pork exports remained 2 percent less than the past year in volume at 1.25 million metric tons; they decreased 6 percent in value to $3.14 billion.
Pork-export value averaged $56.99 per head slaughtered in June, an increase of 7 percent from a year ago – the best monthly average since April 2018. First-half export value averaged $50.05 per head, a decrease of 9 percent from the same period this past year. June exports accounted for 27.8 percent of total U.S. pork production, increasing from 25.8 percent a year ago. June exports accounted for 24 percent for muscle cuts only, increasing from 22.4 percent a year ago. For January through June, exports accounted for 25.8 percent of total pork production, decreasing from 27.3 percent, and 22.4 percent for muscle cuts, decreasing from 23.6 percent.
Beef exports increased 3 percent year-over-year in June to 118,677 metric tons. Export value at $724.8 million increased just 1 percent from a year ago. That value trailed only August 2018, May 2019 and October 2018 for the best monthly-value total on record. First-half beef exports decreased 2 percent from a year ago in volume to 648,765 metric tons, but held steady with the previous year’s record value pace at $4.03 billion.
Beef-export value per head of fed slaughter averaged $325.10 in June, an increase of 4 percent from a year ago. First-half export value averaged $312.06 per head, a decrease of 2 percent. June exports accounted for 15.4 percent of total U.S. beef production, an increase of almost a full percentage point from the previous year. For muscle cuts only, exports accounted for 12.7 percent of production – an increase from 12.3 percent the previous year and the best ratio since July 2018. For the first half of the year exports accounted for 14.2 percent of total production, a decrease of 14.6 percent from a year ago. For the first half of the year exports accounted for 11.6 percent for muscle cuts, a decrease from 11.9 percent a year ago.
Duty-free access bolsters pork exports to Mexico
The 20-percent retaliatory duty on most U.S. pork exports to Mexico was removed May 20 when the United States, Mexico and Canada reached an agreement regarding steel and aluminum tariffs. Entering Mexico duty-free for the first time in nearly a year, June exports to Mexico were the largest since January at 59,837 metric tons – steady year-over-year. Value increased 13 percent to $119 million, the best since April 2018.
“It’s a tremendous relief to have Mexico’s retaliatory duties on U.S. pork behind us, as the June bump in export value clearly illustrates,” said Dan Halstrom U.S. Meat Export Federation president and CEO. “Now the goal is to get back to the record-setting trend the U.S. industry established in Mexico from 2012 through 2017, prior to the metal-tariff dispute. (The federation’s) marketing programs have ramped an increase of in Mexico so that we can recapture lost market share and regain momentum in this critical market for U.S. pork.”
Despite retaliatory duties remaining in place, June also brought an encouraging increase in pork exports to China. They were the largest in more than three years at 41,704 metric tons, an increase of 123 percent year-over-year, valued at $88.5 million, an increase of 77 percent. That pushed first-half exports to China 23 percent better than the previous year in volume at 177,060 metric tons and 3 percent better in value at $353.1 million. For the China-Hong Kong region, first-half exports increased 4 percent to 224,009 metric tons but value decreased 16 percent to $427.8 million. The European Union remains the primary pork supplier to China-Hong Kong. EU exports to the region through May were 859,030 metric tons, an increase of 27 percent year-over-year, valued at $1.57 billion, an increase of 34 percent. China-Hong Kong has accounted for 52 percent of EU export volume in 2019, compared to 18 percent of U.S. exports.
All U.S. pork and beef’s major competitors gained tariff relief in Japan this year through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the economic partnership agreement between Japan and the European Union. That resulted in red-meat trade being a major focus of the U.S.-Japan trade-agreement negotiations that continued this past week. Japan is the leading value destination for U.S. pork. June exports were steady with the previous year in both volume at 31,742 metric tons and value at $131.5 million. For the first half of the year exports to Japan were 4 percent less than the previous year’s pace in volume at 191,281 metric tons. They decreased 6 percent in value at $773.5 million. Japan’s imports of chilled U.S. pork decreased just 1 percent in volume at 100,869 metric tons and 2.5 percent in value at $481 million. But imports of U.S. ground-seasoned pork decreased 24 percent to 41,769 metric tons, with value decreasing 33 percent at $109.5 million. U.S. share of Japan’s ground-seasoned-pork imports was 58 percent, a decrease from 67 percent the previous year and almost 75 percent in 2017.
First-half highlights for U.S. pork include several other wins.
Despite a June slowdown, first-half exports to Colombia were still an increase of 20 percent from a year ago in volume at 55,148 metric tons and 13 percent in value at $118.8 million. Combined with excellent growth in Chile and Peru, exports to South America increased 35 percent from the previous year’s record pace in volume at 84,032 metric tons and 34 percent higher in value at $205.4 million.
Australia is one of U.S. pork’s best-performing markets in 2019, with first-half volume at an increase of 44 percent to 56,338 metric tons and value increasing 32 percent to $150.1 million. With exports to New Zealand also increasing significantly this year, exports to Oceania increased 43 percent from a year ago in volume at 61,597 metric tons and 32 percent in value at $166.4 million.
In Central America, where pork exports also set new records in 2018, first-half volume was an increase of 11 percent to 44,614 metric tons while value increased 12 percent to $106.8 million. Exports to leading market Honduras were a slight increase from a year ago, while strong growth was achieved in Guatemala, Panama, Costa Rica and Nicaragua.
Korea, Taiwan lead beef export growth
This past year South Korea surpassed Mexico as the second-largest destination for U.S. beef exports. In 2019 it continues to close the gap on leading-market Japan. Exports to Korea remained on a record pace in June, increasing 2 percent from a year ago to 25,118 metric tons. That’s a post-bovine spongiform encephalopathy best. Value increased 15 percent to a record $178.3 million. Those results pushed first-half exports to Korea to 12 percent more than the previous year in volume at 126,879 metric tons and 15 percent more in value at $921.8 million. U.S. beef now accounts for 61 percent of Korea’s chilled beef imports. That’s an increase from 57 percent in the first half of the previous year, with chilled volume increasing 7 percent to 26,537 metric tons.
Beef exports to Taiwan finished a strong second quarter with June shipments reaching a new monthly best of 6,654 metric tons. That’s an increase of 40 percent from a year ago, valued at $58 million, which is an increase of 46 percent and the second-best on record. First-half exports to Taiwan were 16 percent more than the previous year’s record pace in volume at 31,132 metric tons and 11 percent better in value at $276.2 million.
U.S. beef faces a significant tariff-rate disadvantage in leading-market Japan, where June exports totaled 29,794 metric tons. That’s a decrease of 4 percent year-over-year, while value decreased 7 percent to $179 million. For the first half of the year, exports to Japan were 1 percent less than the previous year’s pace in both volume at 157,839 metric tons and value at about $1 billion. Japan’s imports of Australian beef have also slowed this year, but first-half imports from Canada, New Zealand and Mexico were an increase of 83 percent, 37 percent and 28 percent, respectively, offering a glimpse of the increase of side opportunities in the market when tariff rates are reduced.
“It is very gratifying to see U.S. beef posting such remarkable gains in Korea and Taiwan, and the $2 billion milestone could even be in play this year for Korea,” Halstrom said. “Exports to Japan can definitely achieve a similar trajectory if the U.S. can get back on a level playing field with our competitors, so we are encouraged by the progress in the U.S.-Japan trade negotiations.”
There are more first-half highlights for U.S. beef.
June exports of beef-variety meat were the best in two years at 28,195 metric tons, an increase of 13 percent from a year ago. Value also climbed 13 percent to $79.7 million. That pushed first-half export volume even with the previous year at 158,466 metric tons while value increased 8 percent to $472.9 million. The large June increase was primarily driven by growth in Japan and Indonesia, while exports to Egypt rebounded from 2018’s reduced levels.
Though first-half export volume to Mexico decreased 3 percent year-over-year to 114,541 metric tons, export value increased 6 percent to $539.1 million. Beef muscle-cut exports to Mexico slowed in June but still finished the first half for an increase of 4 percent from a year ago in volume at 70,333 metric tons and 8 percent in value at $422 million.
U.S. beef-muscle cuts also have a rapidly growing presence in Colombia, where first-half muscle-cut exports increased 29 percent from a year ago in volume at 1,919 metric tons and 36 percent in value at $11.2 million. Combined beef and beef-variety meat exports to Colombia increased 1 percent from a year ago to 2,991 metric tons while value increased 27 percent to $12.4 million. First-half exports to Chile, the best South American market for U.S. beef, increased 5 percent to 6,144 metric tons, with value increasing 7 percent to $34.3 million.
The Dominican Republic has emerged as a strong growth market for U.S. beef, with first-half exports soaring 57 percent more than the previous year’s record pace in volume at 4,524 metric tons and gaining 47 percent in value to $36.2 million.
Fueled by strong growth in the Philippines and Indonesia, first-half exports to the Association of Southeast Asian Nations region increased 23 percent from a year ago in volume at 26,711 metric tons and 8 percent in value at $132.4 million.
U.S. lamb exports better than 2018 pace
June exports of U.S. lamb totaled 1,073 metric tons, an increase of 6 percent from a year ago, but value fell 21 percent to $1.73 million. For the first half of 2019, lamb exports increased 42 percent year-over-year in volume at 7,783 metric tons and 17 percent in value at $13.2 million. Mexico has been the primary growth driver for U.S. lamb, with first-half exports to Mexico increasing 52 percent from a year ago in volume at 6,762 metric tons and 33 percent in value at $6.7 million. Exports also showed promising growth in the Dominican Republic, Bermuda, Panama and Guatemala.