July Pork Exports Rebound, but Still Below Year-Ago

 

Source: U.S. Meat Export Federation (USMEF)

Sep 4, 2020

 

U.S. pork exports, which are on a record pace in 2020, were down from a year ago in July but increased compared to June, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF).  

 

 “China’s pork demand has moderated and we are also entering a time when year-over-year gains are not nearly as dramatic, as exports to China began gaining momentum in mid-2019. But pork exports to Mexico showed encouraging signs of recovery in July and we also saw promising growth in several emerging markets, including Vietnam and the Philippines,” said USMEF President and CEO Dan Halstrom.

 

“It is also important to remember that the monthly export data is in the rear-view mirror and that weekly export sales data, along with observations from our USMEF-China team, suggest that China’s demand for both U.S. pork and beef will be strong through the balance of the year, including purchases for Chinese New Year. When combined with the rebound in other main markets, growth in emerging markets and the return of the U.S. supply advantage, USMEF remains optimistic about a strong finish for U.S. red meat exports in 2020, despite many challenges related to COVID-19.”

 

July pork exports totaled 222,035 mt, down 5% from a year ago, while export value fell 12% to $548.3 million. Exports increased year-over-year to China/Hong Kong, Canada, the Philippines, Vietnam and the Caribbean. Exports to Mexico remained below last year but were the largest since March, while shipments to Japan were also down from a year ago but the largest since April. For January through July, pork exports remained 20% ahead of last year’s record pace in volume (1.78 million mt) and 22% higher in value ($4.6 billion).

 

Pork export value equated to $48.85 per head in July, down 17% from a year ago. The January-July average was $61.40, up 20%. July pork exports accounted for 26% of total pork production and 24% for muscle cuts, compared to 29.3% and 25.9%, respectively, a year ago. Through July, pork exports accounted for 30.7% of total production and 27.9% for muscle cuts, still up significantly from a year ago (26.3% and 22.9%, respectively).

 

Strong growth for U.S. pork in ASEAN region; exports to Mexico show rebound

 

China/Hong Kong remained the leading destination for U.S. pork exports in July at 71,853 mt, up 5% from a year ago but the lowest since October. Export value was down slightly from a year ago to $151.1 million. Through July, exports to the region were 131% above last year’s pace at 676,009 mt, with value up 171% to $1.57 billion.

 

The ASEAN region continued to shine for U.S. pork in July, with the Philippines joining Vietnam in a strong upward trend in demand. July exports to the Philippines climbed 90% higher than a year ago to 4,640 mt, with value soaring 141% to $11.8 million. Through July, exports to the Philippines pulled even with last year in volume (21,735 mt) and were 8% higher in value ($54.3 million). July muscle cut exports to Vietnam set a new record of 2,443 mt valued at $5.3 million. Total exports to Vietnam were the largest in more than 10 years at 2,923 mt, up 278% from a year ago, with value up 552% to $6.3 million. This pushed January-July exports to 11,155 mt (up 173%) valued at $24.2 million (up 212%). Region-wide exports to the ASEAN were 25% above last year in volume (36,736 mt) and 31% higher in value ($89.9 million).

 

“The impact of African swine fever in the ASEAN region has been somewhat overshadowed by the situation in China, but several countries are struggling with the disease,” Halstrom said. “The increase in demand for imported pork surfaced most quickly in Vietnam, but growth opportunities are emerging throughout Southeast Asia.”

 

While July pork exports to Mexico remained well below last year at 56,185 mt (down 16%), valued at $81.1 million (down 36%), shipments were up significantly compared to the low totals reported in May and June. Through July, exports to Mexico were 8% below last year’s pace at 380,666 mt, with value down 11% to $624.2 million.

 

Other January-July highlights for U.S. pork include:

 

·         July exports to Japan, traditionally the leading value market for U.S. pork, were down 6% from a year ago to 29,293 mt, valued at $128.6 million (down 3%). Through July, export volume to Japan was steady with last year at 223,115 mt and value remained 4% higher at $942.3 million. The impact of limited labor availability on U.S. exports is pronounced in Japan, where value-added cuts are demanded for the chilled retail business.

·         After slowing in the second quarter, pork exports to Canada rebounded in July to pull 2% ahead of last year’s pace in both volume (126,172 mt) and value $463.6 million.

·         Solid growth in the Dominican Republic and Trinidad and Tobago pushed exports to the Caribbean 5% above last year at 33,990 mt, valued at $80.2 million (up 2%).

·         In Eastern Europe, pork exports continue to gain momentum in Albania (2,119 mt, up 25%; $4.2 million, up 69%) and Ukraine (852 mt, up from just 44 mt last year; $2 million, up 613%).

 

Beef exports to China continue to grow; other Asian markets show signs of recovery … 

 

July lamb exports largest of 2020 …

  

NOTES:

 

·         Export statistics refer to both muscle cuts and variety meat, unless otherwise noted.

·         One metric ton (mt) = 2,204.622 pounds.

·         U.S. pork currently faces retaliatory duties in China. China’s duty rate on frozen pork muscle cuts and variety meat increased from 12% to 37% in April 2018, from 37% to 62% in July 2018 and from 62% to 72% on Sept. 1, 2019. The rate on pork cuts was reduced to 68% on Jan. 1, 2020, through a reduction in the most-favored-nation (MFN) rate and to 63% on Feb. 14, 2020, through a reduction in the Section 301 retaliatory duty. The duty on pork variety meat was reduced to 67% on Feb. 14.

·         U.S. beef faces retaliatory duties in China. China’s duty rate on beef muscle cuts and variety meats increased from 12% to 37% in July 2018 and from 37% to 47% on Sept. 1, 2019. It was reduced to 42% on Feb. 14, 2020.

·         In February 2020, China announced a duty exclusion process that allows importers to apply for relief from duties imposed in response to U.S. Section 301 duties. When an application is successful, the rate for U.S. beef can decline to the MFN rate of 12% and the rate for U.S. pork can decline to 33% for muscle cuts and 37% for pork offal (the 25% Section 232 retaliatory duty on U.S. pork remains). Some importers reported receiving duty relief beginning on March 2, 2020.

·         Mexico’s duty rate on pork muscle cuts increased from zero to 10% in June 2018 and jumped to 20% the following month. Beginning in June 2018, Mexico also imposed a 15% duty on sausages and a 20% duty on some prepared hams. Mexico removed all duties in late May 2019.

 

document, plus charts

https://www.usmef.org/news-statistics/press-releases/july-beef-and-pork-exports-rebound-but-still-below-year-ago/