Export report shows excellent starting point for beef, pork sales around the globe
Though the first weekly export update for 2019 wasn’t published until Feb. 14, the Daily Livestock Report (DLR) noted, “The supply of beef and pork that was sold but had yet to deliver at the start of the year was higher than at the same point a year ago.”
However, DLR also noted a few caveats within the report.
Looking deeper at beef numbers, outstanding export sales were 5.6 percent higher than a year ago, with outstanding export sales to Hong Kong at 64.7 percent higher than a year previous.
“This begs the question, will Hong Kong take possession of this product, or will it lead to significant cancellations in the next few months?” asked DLR. “It would not be a reach to suggest the delay may be a result of the current trade war between the U.S. and China, as Chinese officials appear to have tightened up border controls.”
Further, media reports have noted China has clamped down on “food smuggling.” In particular, Indian buffalo meat is not allowed into China, but reports have shown the product is often found in the country via “gray trade” from neighboring countries.
“China beef imports exploded in 2018 due to growing demand for beef and possibly the effect of tighter border control rules,” explained DLR.
Further, China became the top market for New Zealand’s beef in the last quarter of 2018, surpassing the U.S.
“Without the outstanding sales to Hong Kong, the remainder of outstanding U.S. beef export sales is lower than the previous year,” they commented.
On the pork side, DLR noted sales were up 14.8 percent from 2018, with a significant portion of sales also to China.
“Much of the discussion in the market currently revolves around the potential demand from China in 2019 due to the spread and supply losses from African Swine Fever,” the organization noted. “This is a valid point and something the market may have to contend with later this year.”
However, DLR also said tariffs in Mexico may have an even bigger impact on U.S. pork producers.
“Outstanding pork sales to Mexico at the start of the year were 10 percent higher than the same period a year ago,” DLR wrote. “Mexican buyers were quite active in buying U.S. pork in December.”
Net sales for the first three weeks of December averaged almost double the same period a year ago.
DLR commented, “With more product currently on the books and ongoing tariffs on U.S. pork, Mexican buyers appear to be in no rush to add even more to their position.”
Saige Albert is managing editor of the Wyoming Livestock Roundup and compiled this article from a Feb. 14 edition of the “Daily Livestock Report.” Send comments to firstname.lastname@example.org