The U.S. Meat Export Federation Strategic Planning Convention received underway Wednesday in Oklahoma Metropolis, attracting farmers, ranchers, processors and exporters from all through the nation. Whereas U.S. purple meat exports will seemingly set a price file approaching $20 billion this 12 months, the trade faces an array of obstacles associated to the sluggish international financial system, weakening currencies of key buying and selling companions and lingering results of the COVID pandemic. Challenges are additionally mounting on the manufacturing aspect, particularly for livestock producers impacted by drought.
Keynote speaker Randy Blach, CEO of CattleFax, detailed the larger-than-expected contraction of the cattle herd, which helped drive U.S. beef manufacturing and exports to file highs in 2022 however can be a big constraint for U.S. exporters subsequent 12 months. The drought has additionally heightened manufacturing prices for cattle feeders.
“For those who’re placing an animal in a feedyard anyplace within the Central Plains – as an example Kansas or Oklahoma – your value to placed on a pound of achieve is between $1.30 and $1.40,” Blach stated. “We’ve got not seen that traditionally, not even again in 2008 after we had the ethanol mandate and for a time frame corn was at $8.00 per bushel.That is an fascinating time, when the market wants extra corn and the place it is wanted most, the corn simply is not there.”
However Blach additionally highlighted the outstanding effectivity and sustainability of the U.S. beef trade, which he maintains is well-positioned for achievement even on this difficult setting.
Randy Blach notes that beef exports have dramatically elevated per-head worth and there may be important potential for continued progress.
“Each time I ask an viewers ‘who’s the most important beef producer on the planet?’ – everybody says Brazil as a result of it has 300 million cattle,” Blach stated. “However we’re producing extra beef than Bazil with solely one-third the variety of cattle. Why? Due to our high-quality, grain-fed beef. The U.S. has one of the best carbon footprint of anyone on the checklist of high beef producers, due to the best way our manufacturing methods work and the quantity of manufacturing that we get on a per-head foundation.”
Blach added that the U.S. achieved file beef manufacturing in 2022 with 30 million fewer cattle than within the Nineteen Seventies.
“That is what sustainability is – doing extra with much less, and doing it higher with nice animal husbandry,” he stated. “And I commend each certainly one of you who stand up each morning to go feed these cows and calves, or feed these fed cattle. You are doing a hell of a job – stick with it.”
Blach additionally extolled the effectivity of America’s corn and soybean producers, noting that it’s a important issue within the international success of the U.S. meat trade.
“The U.S. is the most important high-quality meat producer on the planet,” he stated. “We produce essentially the most beef, essentially the most broiler meat and the third-largest quantity of pork on the planet. Typically it is simple to overlook that we can not obtain this success with out the soybean meal and grain merchandise that these of you within the corn and soybean industries produce. It is essential that we acknowledge what a important ingredient you present for all of those proteins.”
USMEF President and CEO Dan Halstrom gave members an replace on year-to-date export outcomes and his outlook for coming months. Whereas difficult instances lie forward, Halstrom highlighted the significance of market diversification in maintaining beef exports on a file tempo by way of the primary three quarters of 2022. Pork exports are additionally regaining momentum, surpassing year-ago ranges the previous two months.
“World demand is powerful, even record-breaking, regardless of rising costs,” stated Halstrom. “However at what level do worldwide shoppers reduce?”
He listed a number of mounting obstacles for U.S. exports, together with international inflation, ongoing provide chain challenges and the strengthening U.S. greenback. For example, Halstrom famous that devaluation of the Japanese yen has pushed costs for U.S. meat merchandise 30% increased than a 12 months in the past in a particularly aggressive market.
Market diversification has lengthy been a high precedence for USMEF, and Halstrom praised the U.S. trade’s dedication to growing new and rising markets for purple meat exports. He famous that the often-tense U.S.-China relationship underscores the significance of this technique. Halstrom defined that whereas China is a significant U.S. purple meat buyer, on tempo to buy $4 billion in U.S. beef and pork this 12 months, the U.S. is just not almost as depending on China as most different suppliers.
“Uruguay exports 58% of its beef manufacturing to China, New Zealand 44%, Brazil 18% and Australia 14%,” Halstrom stated. “However even with our latest progress, simply 3% of U.S. beef manufacturing is exported to China.”
For pork muscle cuts, simply 2.3% of U.S. manufacturing presently goes to China. Chile and Brazil ship 17% of their pork muscle reduce manufacturing to China, whereas China accounts for 9% of Canada’s manufacturing and 6% for the European Union.
Commerce boundaries usually make market diversification tougher, and Halstrom requested USMEF members to stay vigilant and make their voices heard in Washington.
“Our opponents understand the worth of commerce and so they’re not standing nonetheless,” Halstrom stated. “Hopefully we are able to encourage extra aggressive motion, together with getting a USTR chief ag negotiator and USDA undersecretary for commerce confirmed quickly.”
USMEF members additionally heard from Mark Slupek, deputy administrator of world applications for the USDA Overseas Agricultural Service. Slupek offered a short historical past of USDA’s funding in export market growth, explaining that it dates again to the Eisenhower administration. He praised USMEF as certainly one of FAS’s most profitable cooperators, noting that USDA and USMEF have had a wonderful working relationship for greater than 40 years. He added that robust trade help for USMEF, from a various vary of agricultural sectors, helps guarantee constant funding from USDA.
Mark Slupek of the USDA Overseas Agricultural Service discusses the working relationship between USDA and USMEF.
The USMEF Strategic Planning Convention continues by way of Friday, Nov. 11. Thursday’s common session will concentrate on USMEF’s market growth efforts in Japan, the place the group lately marked the forty fifth anniversary of its Tokyo workplace. This can be adopted by breakout classes for USMEF’s pork, beef, exporter and feedgrain and oilseed sectors. Friday’s closing enterprise session will embrace an outline of the Biden administration’s present commerce initiatives and election of recent USMEF officers.
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