Although May was the strongest month so far this year for U.S. beef exports, volume was down 13% compared to May 2011 and stood 10% lower through the first five months of the year, according to USMEF calculations on data released by the USDA.
Beef export value in May ($471.1 million) was 4% higher than a year ago, which kept year-to-date export value ($2.19 billion) 5% ahead of last year's record pace.
With the April 24 announcement of the fourth BSE case in the United States, May was the first month in which any BSE-related decline could be detected in export statistics. May beef exports did not reveal a major impact, though global totals were likely affected to some degree by the market closure in Saudi Arabia and negative media coverage in some Asian markets.
"All things considered, we are pleased with the manner in which beef exports have weathered the most recent BSE case," said USMEF President and CEO Philip Seng. "With the exception of Saudi Arabia, we have not suffered any significant setbacks in terms of market access. And though we expected consumer interest to slow temporarily in markets such as Korea, the May export results were actually quite strong."
Seng explained that while year-to-date exports to Korea were down 24% in volume and 17% in value, May results were higher (+5% in volume, +13% in value) in both categories. He said the main factors impacting U.S. beef exports to Korea in 2012 are an oversupply of domestic beef and a slumping Korean currency, noting that Australia's beef exports to Korea have also declined by about one-third compared to last year.
In several major markets, beef export volume has slowed moderately compared to the first five months of last year but increases in export value were still achieved. Examples include:
-Japan, where volume was down 6% to 56,297 metric tons but value was 13% higher at $370.7 million. In May, Japan was the largest destination for U.S. beef with the highest export volume (16,166 metric tons) in 10 months. Export value was up 28% from May 2011 to $105.3 million. Regulatory officials in Japan continue to examine the 20-month cattle age limit on beef imported from the United States, Canada and the European Union, but have so far enacted no change in the policy.
-In Canada, the only $1 billion market for U.S. beef in 2011, export volume was down 7% to 64,260 metric tons but value was up 10% to $404.5 million.
-In the Middle East, export volume was down 7% to 60,106 metric tons while value was up 10% to $138.1 million. Although Saudi Arabia was the only country in this region to close to U.S. beef due to the BSE case, confusion regarding possible restrictions which never materialized in some other markets may have affected May results. Despite these issues, however, May export volume (12,766 metric tons) to the region was the largest since January.
-In the ASEAN region, export volume (25,964 metric tons) was down 12% while value ($112.3 million) was 13% higher. This trend was made possible by a surge in export value to the two largest markets, Vietnam and the Philippines.
-In Hong Kong, where U.S. exports are still limited to boneless muscle cuts from cattle under 30 months of age, export volume (19,566 metric tons) was down 15% while export value ($112.9 million) was 12% higher. May export volume to Hong Kong was the largest of the year.
Two regions in which U.S. beef exports are surging in both volume and value are Russia and Central and South America. Though export activity to Russia has slowed in recent weeks, January-May exports were 24% ahead of last year's record pace in volume and 83% higher in value at $138.8 million. Bolstered by terrific growth in Chile, exports to Central and South America were up 42% in volume and 83% in value at $53.8 million.
"In Russia, we are aggressively promoting U.S. beef across several sectors and in a variety of geographic regions," Seng said. "From the Black Sea coast where the next Winter Olympics will be held, to the far eastern port of Vladivostok, U.S. beef is becoming more widely known and is in very high demand. Russia has expanded the import quota for U.S. beef this year, and we intend to make full use of that opportunity."
"In Central and South America, we have capitalized on some excellent growth opportunities," he explained. "Trade barriers have limited available supplies from Paraguay and Argentina, increasing demand in markets such as Chile, Peru and Colombia. This is one reason for the tremendous interest in this week's USMEF Latin American Product Showcase, which has attracted a strong turnout of buyers and exporters to Bogota."
U.S. beef exports have slowed dramatically to Taiwan. Exports in May were down about 90% from last year, while year-to-date exports were 54% lower in volume and 47% lower in value at $39 million. While the Taiwanese government is expected to take action soon on a maximum residue level for ractopamine in imported beef, U.S. beef sales likely face a lengthy recovery due to the political controversy surrounding this issue.
Full statistics are available here.