TL;DR: US beef exports decreased while imports from Brazil and Australia surged, influenced by domestic production challenges and a strong US dollar enhancing the attractiveness of imports.
Decline in Beef Exports
US beef exports have faced a noticeable decline early in 2024, continuing a negative trend from the previous year. In February, exports decreased by 1.3% compared to the same month last year, with an overall 2.6% drop for the first two months. This follows a significant 14.3% decrease in 2023 from the record highs in 2022.
Major Markets Show Varied Responses
The top beef export markets have also shown declines. Japan, the leading market, saw a 13.5% drop, while South Korea and China/Hong Kong decreased by 5.5% and 2.6%, respectively. Meanwhile, Canada and Taiwan, ranking fifth and sixth, decreased by 2.0% and 7.5% respectively.
Mexico Shows Recovery
In contrast, Mexico, which had fallen from being the third to the fourth largest market, shows signs of recovery. Beef exports to Mexico rose by 20.7% in the first two months of 2024, building on a 12.2% increase in 2023.
Surge in Beef Imports
Beef imports have sharply increased, with a 23.8% rise in February year over year and a 31.9% increase for the first two months combined. This growth follows a 9.9% increase in 2023. Brazil has significantly contributed to this surge, with a 41.8% increase in imports so far this year.
Other Notable Import Increases
Imports from Australia have also risen sharply, recording a 111.3% increase year over year, making it narrowly the third largest import source. Canada remains the second largest source, showing a 9.0% increase. New Zealand, ranking fourth, has seen a 48.6% rise in imports.
Challenges and Adjustments
The US beef market continues to face challenges such as decreased beef production and increased prices. A strong US dollar exacerbates these issues, making US beef more expensive for international buyers and more attractive for imports.
Demand for Lean Beef
The demand for lean-processing beef in the US remains strong, driven by decreasing domestic supplies of non fed beef. This demand has pushed prices for 90% lean beef to record levels. Despite a decline in overall fed beef production, a high supply of fatty trimmings from feedlot cattle is boosting the demand for both domestic and imported lean-processing beef to support ground beef production.
