CME: Higher Beef Prices Likely to be Cause of Slowdown in Shipments During Q1/2019
via The Cattle Site - 13 May 2019
US - Market focus remains on ongoing trade talks between US and China. But it is still important to stay in tune with fundamentals, writes Steiner Consulting Group, DLR Division, Inc.
As Ben Graham once said, "In the short run the market is a voting machine, but in the long run it is a weighing machine." Exports are one piece of the fundamental picture. Unfortunately for many in the market the official trade statistics do not come out as quickly as they would like.
This is a big country and it takes time to collect and analyze all the trade data. As technology gets better, reporting will probably improve but thatís where we are. On Thursday, USDA reported the official ag trade data (collected by US Census) for March. April export statistics will be issued 6 June.
Total US exports fresh/frozen and processed beef and veal in March were 81,278 MT, 5.1 percent lower than the previous year. The value of those exports was estimated at around $600 million, 2.9 percent lower than last year.
Higher prices for beef in the first quarter of the year likely contributed to the slowdown in US beef† shipments. The biggest contributor to the decline in US beef exports in was Hong Kong. Total shipments to Hong Kong declined by 3,816 MT or 41 percent compared to a year ago.
Hong Kong commitments to purchase more beef remains dramatically higher than a year ago but so far the flow of shipments to that market has been underwhelming, probably a function of current trade relationship between US and China.
Japan was the biggest market for US beef in March, buying 21,551 MT of beef from the US. That volume, which is still the biggest among all trading partners, was down 9 percent compared to a year ago.
One issue that may be affecting US beef exports to this market is the widening tariff gap between US and other partners following the signing of the revised TPP agreement. A trade deal between US and Japan will be very helpful for US beef access to this market...
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