Comment: U.S. beef exports up, producer revenue down

What good are growing exports to producers who are starting to struggle to pay the bills?


by Bill Bullard, CEO of R-CALF USA

via Manitoba Co-operator (Canada) - April 8, 2019


The breaking news is that 2018 U.S. beef exports hit new records. The U.S. Meat Export Federation (USMEF) wrote that 2018 beef exports “shattered the previous value record and achieved a new high for volume,” and, “Export value soared to $8.33 billion, breaking the 2017 record by $1.06 billion — an increase of 15 per cent.”


Just a few weeks ago, the Beef Checkoff Program announced it had achieved a 15 per cent increase in beef demand.


Amidst this great news, the USMEF further proclaimed, “Beef export value was also record shattering on a per-head basis, averaging $323.14 per head of fed slaughter in 2018.”


This must be tremendous news for cattle producers. After all, the entire meat lobby has worked diligently, if not exclusively, to convince every cattle producer that they need not worry about such trivial matters as enforcing antitrust laws, writing rules to implement the Packers and Stockyards Act, reforming trade policy, or restoring country-of-origin labelling (COOL). The meat lobby’s tireless drumbeat has been that the only thing cattle producers want and need is more beef exports and increased beef demand.


Congratulations! You did it!


And the trophy for those who sell domestic cattle — born and raised in the United States cattle — is depressed prices. The U.S. Department of Agriculture (USDA) reports the 2018 average five-area fed steer price was $117.26. That’s less than what cattle producers received six years ago in 2012.


Six years ago, when the average steer price was higher than in 2018, the beef export value was only $5.5 billion, which was $2.8 billion less than the record $8.3 billion in 2018. And, the 2012 volume of beef exports was 219,000 metric tons less than the 2018 record.


Shrinking producer share ...