The research arm of Rabo AgriFinance says the Japanese earthquake/tsunami disaster could produce even more demand for U.S. beef.
Rabobank's Food & Agribusiness Research and Advisory group today released a report suggesting that based on the current weakness of the US dollar compared with the Australian dollar (two major suppliers of beef to Japan), the US market would be first in line to supply additional beef exports.
An increasing rate of exports would make an already record-priced domestic market even more bullish, it adds.
The group also says the damaged areas in Japan produced 18% of Japanese beef, 25% of pork and 22% of poultry.
The worst-case scenario would be 50% of production capacity lost in the impacted area. That would be 46,000 metric tons of beef supply (.07% of global trade), 163,000 metric tons of pork supply (2.9% of global trade) and 142,000 metric tons of poultry supply (1.9% of global trade) destroyed.
An unknown factor which could add to the potential need for imports is the amount of spoiled meat caused by interrupted cold storage because of electricity loss. If Japan keeps the same storage ratio as the US, the affected volume would be 8,000 metric tons of beef, 29,000 metric tons of pork and 26,000 metric tons of poultry.