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Variety meats play key role in beef export market
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Variety meats play key role in beef export market

Beef Carcass

Muscle cuts may garner the headlines, but variety meat exports remain a key component in U.S. meat exports.

The U.S. exported $7.6 billion in beef and variety meat products in 2020, says Brenda Boetel, an ag economist with the University of Wisconsin-River Falls.

“When the value for hides and all offal products is added, the total offal value plus hides accounted for 20.7% of the export value in 2020, down from 22% in 2019,” she wrote in her “In the Cattle Markets” column.

According to the USDA’s Agricultural Marketing Service, the hide and offal value from a typical slaughter steer was estimated at $9.71 per hundredweight on a live basis. Boetel says this includes hides, variety meats and tallow.

“This value equates to $135.94 for a 1,400 lb. steer,” she said. “This value has been increasing recently and is at a level last seen in May 2018.”

Much of this ends up exported to destinations such as Japan and Mexico. Japan imported $369 million of variety meats in 2020, while Mexico’s total was $228 million. Boetel said Japan is the leading importer of beef tongue, while Mexico is the leader in tripe imports.

“As their import levels of variety meats change, so does the value contribution of tongue and tripe change in the overall byproduct value calculation, which ultimately will impact the finished steer price,” she said.

Boetel added the COVID-19 pandemic has changed the way processing plants operate.

“Beef and beef by-products are typically produced in nearly fixed proportions; however, when packers experienced line disruption in 2020, many plants changed fabrication methods to keep more whole muscles/primals intact and keep less offal to maximize line speed,” she said.

“The decrease in beef and offal provided less opportunities for exports, and by-product values decreased to $6.79 in May 2020. When these edible offal products are not exported, they will often go into rendering or into pet food and ultimately decrease the overall value of the finished steer.”

She says as plants resume normal operation, by-product production “has mostly returned to pre-COVID levels, and given the relatively fixed pounds of by-products per 1,400-lb. steer, the by-product drop value contributions have been increasing due primarily to changes in demand.”

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Jeff DeYoung is livestock editor for Iowa Farmer Today, Missouri Farmer Today and Illinois Farmer Today.

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