Without full access to Japan
and Korea, Mexico remains the top destination for U.S. beef and beef
variety meat exports. It is likely that 2007 will exceed last year's
record of $1.2 billion in sales. Through October, exports to Mexico were
down two percent in volume, but they were up four percent in value.
Another key feature is that the per pound value of U.S. beef exports to
Mexico continues to grow from about $1.40/lb in 2003 to more than
$1.70/lb today.
Year-to-date exports to
Canada are up 33 percent in volume and 36 percent in value. Driven by
the decline in the value of the U.S. dollar, the record pace of U.S.
beef exports to Canada should end up very near $600 million in 2007,
easily making Canada our second largest customer. This would exceed any
previous year by roughly $150 million.
The forecast for U.S. beef
outside the "Big 4" (NAFTA plus Japan and Korea) markets predicts an
increase of 22 percent based upon trade data through October. Vietnam is
up 276 percent with ASEAN (Vietnam, Philippines, Singapore Thailand,
Malaysia and Indonesia) up 210 percent. Exports to the EU are up 144
percent; Central/South America is up 58 percent; and the Caribbean is up
15 percent.
Through October, we exported
80,530 metric tons to the Middle East, up 7 percent on the year. This is
mostly variety meat trade, with the United States now sending more
variety meats (mostly livers) to Egypt (72,000 mt year to date) than we
ever sent to Russia (60,000 mt in 2003). Angola is the third largest
market for U.S. variety meats at 8,000 mt, and Mexico is consistently
our top destination for beef variety meats at 139,000 mt.
U.S. beef producers remain
flat out angry that South Korea and China still won't buy U.S. beef, and
that access to Japan is running at a pace about one-fifth below where it
should be due to BSE-related trade restrictions. Sales to the rest of
the world will likely set new records again in 2008. However, this will
be overshadowed by the $6-8/cwt still missing in fed cattle prices due
to the lack of access to South Korea and Japan. Also, the fact that U.S.
beef may not be available for travelers to this summer's Olympic Games
in China strikes an offensive tone among U.S. cattlemen.
We already have over 15,000
mt on the books in the first week of this year to Mexico because of a
change in Mexico's tax law in 2007. In the coming year, industry
analysts see continued (4-5 percent) growth in business to Mexico and
another huge year for exports into Canada. Growth in exports to the EU
is certainly a hot topic at the moment, and the big wild card is Russia
where exporters are seeing interest in U.S. beef (rounds) begin to open
up rather than the traditional beef variety meat (liver) exports.
