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CME: Exports Grow as US Fills Demand

by 5m Editor
15 July 2011, at 8:55am

US - Beef, pork and broiler exports continued to climb in May as international buyers increasingly turn to the US to fill ever growing demand, write Steve Meyer and Len Steiner.

Below are the highlights (please note the data is in pounds, carcass weight basis):

Beef exports in May were pegged at 234.8 million pounds, 15.4 per cent higher than a year ago.

In the first five months of the year, US beef exports reached 1.1 billion pounds, 232.5 million pounds or 27 per cent higher than the comparable period a year ago.

The latest WASDE report raised the estimate for US beef exports in 2011 to 2.613 billion pounds (+314 mil lbs. more than in 2010) and we suspect that forecast will be raised again in the coming months on strong beef demand from Asian and North American markets.

While beef exports to Korea declined 10 per cent in May, US beef shipments to Japan remain very strong and at 43.9 million pounds they were 50.4 per cent higher than a year ago and the largest monthly volume to this market since December 2003.

Japanese demand has been very firm following the tsunami and nuclear disaster due to domestic supply disruptions, a reduction in seafood consumption as well as a weak US dollar vs. the Japanese yen. Currently the Japanese Yen is up 16 per cent in value compared to May 2010.

The growth in Japanese beef exports accounted for almost half of the overall increase in US beef exports in May.

Beef exports to Canada were up 23 per cent from a year ago while shipments to smaller markets rose 21 per cent.

Exports to Mexico remain steady while exports to S. Korea have been declining after a torrid pace earlier in the year as suppliers rushed to build inventories after the Foot and Mouth Disease (FMD) outbreak.

Pork exports in May were 408.8 million pounds, 12.7 per cent higher than a year ago.

This was the third consecutive month that pork exports have crossed the 400 million threshold, the last time that happened was during the summer of 2008.

At that time, the surge in pork exports was largely driven by big Chinese purchases while this time around growth appears to be more broad based.

Japan continues to buy more US pork, with exports to this market in May reaching 135.5 million pounds, or 16.4 per cent more than a year ago.

Exports to Mexico rose 26.9 per cent to 91.5 million pounds while exports to Canada increased 15.1 per cent to 43.2 million pounds.

As with beef, shipments to S. Korea have slowed down from around 87 million pounds a month in March to about 30 million pounds in May. Still, even at that volume, pork exports to S. Korea were up 33 per cent compared to May 2010.