"Adjusting to supply shocks takes time" - USMEF
The impact of the coronavirus crisis in the US red meat industry is still visible and the beef sector has taken a hard hit in May and June, according to US Meat Export Federation. Beef exports were down sharply from a year ago in June, reflecting a lingering impact of a temporary slowdown in beef production combined with restrictions on foodservice and weakening economies in major import markets. At the same time, June exports of US pork fell below year-ago levels for the first time this year but exports remain on a record pace in 2020.
"We expected that the interruptions in red meat production would continue to weigh on June exports, but anticipated more of a rebound from the low May totals – particularly for beef. But it takes time for the entire chain to adjust to supply shocks, and thus it was another difficult month for exports. However, weekly US export data suggest an upward trend in demand in most markets, and with production recovering the US has regained its supply advantage. So we expect beef and pork exports to regain momentum in the second half of the year", said USMEF President and CEO Dan Halstrom.
June pork exports totalled 207,181 tonnes, down 3% from a year ago, while export value fell 9% to $516.3 million. Exports continued to trend higher than a year ago to China and Hong Kong but were the lowest since October. Exports also increased year-over-year to the ASEAN region, the Caribbean, Honduras and Taiwan and were sharply higher for Albania and Ukraine. But shipments trended lower to Mexico, Japan, South Korea and South America. Despite the June decline, first-half pork exports were still 24% ahead of last year’s record pace in volume (1.55 million tonnes) and 29% higher in value ($4.05 billion).
Exports accounted for 24% of total pork production in June and 22.2% of muscle cut production, down substantially from a year ago (27.8% and 24%, respectively). For the first half of the year, exports accounted for 31.5% of total pork production and 28.6% for muscle cuts, up from 25.8% and 22.4%, respectively, last year. Export value per head slaughtered averaged $46.19 in June, down 19% from a year ago and down sharply from the high levels achieved in April and May. The January-June average was $63.61 per head, up 27% from a year ago.
June beef exports were close to the May lows, down 33% from a year ago to 79,013 tonnes, with value falling 32% to $492.3 million. Exports were below year-ago levels to most markets but trended higher to Canada, China and South Africa. For January through June, beef exports fell 9% below last year’s pace in volume (591,609 tonnes) and 10% lower in value ($3.63 billion).
Exports accounted for 9.7% of total beef production in June and 8% for muscle cuts, down sharply from a year ago (15.4% and 12.7%, respectively) and the lowest in 10 years. First-half exports accounted for 13.3% of total beef production and 10.9% for muscle cuts, down from 14.2% and 11.6%, respectively, last year. Beef export value per head of fed slaughter averaged $219.53 in June, down 32% year-over-year. The first-half average was $300.43 per head, down 4%.
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