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The Midwest Cattleman · October 27, 2022 · P3

                   October 27, 2022   Volume 28   No. 10

        U.S. BEEF EXPORTS TOP $1 BILLION AGAIN                                  REPORT SHOWS ENDING U.S. BEEF TRADE

         August beef exports were                                              COULD BE CATASTROPHIC FOR INDUSTRY
      slightly above last year’s                                              A recent report revealed  port outlines why the U.S.
      large volume and topped $1                                            economic disaster would be  exports and imports beef and
      billion in value for the sev-                                         the end result if all U.S. beef  provides a review of histori-
      enth  time  in  eight  months                                         trade was eliminated.  The  cal beef trade data. The au-
      this year.                                                            report  was authored  by ag- thors  highlight  that  implied
         "We speak often about                                              ricultural economists Glynn  trade prices clearly show the
      the importance of develop-                                            Tonsor of Kansas State Uni- U.S. receives a higher dollar
      ing a wide range of markets                                           versity and Derrell Peel from  per pound value for exports
      for U.S. red meat, and the                                            Oklahoma State University.   than it pays for imports.
      August export results are a  compiled by USMEF. Export                  According to the report, if  From 2016 through 2020,
      great illustration of that,”  value was just under $1.04              both U.S. beef exports and  the U.S. average annual un-
      said US Meat Export Fed- billion, slightly below the                  imports declined by just  prepared beef exports were
      eration President and CEO  then-record total achieved in              10%, prices and quantities  2.05 billion pounds, which
      Dan Halstrom. "Exports face  August 2021, which was the               of feeder cattle and fed cattle  had an export value of $6.4
      significant     headwinds      in first time monthly exports          would  fall  significantly.  Cu- billion and an implied export
      some key destinations, with  topped the $1 billion mark.              mulatively, a 10% reduction  price of $3.13/lb. Conversely,
      weakened currencies topping           August beef exports to          in  beef  trade  over  10  years  the average annual unpre-
      the list. But the emphasis on  China/Hong Kong were re-               would create a loss of $12.9  pared beef imports for that
      broad-based  growth  really  cord-large and shipments to              billion to those selling feed- same time were 2.30 billion
      pays dividends in these sit- leading value market South               er cattle and $6.8 billion to  pounds, with an import value
      uations, allowing the overall  Korea exceeded last year’s             fed cattle sellers. A scenario  of $5.8 billion and an implied
      export picture to remain very  large volume. Exports also             where 100% of U.S. beef trade  import price of $2.52/lb. The
      positive. I also cannot say  achieved robust growth in                was lost would suggest a cat- authors state in the report
      enough about the loyalty of  the Middle East, Canada and              astrophic impact, broadly ap- these  statistics  “clearly  in-
      our international customers,  the ASEAN region, which in-             proximated in the report to  dicate participation in the
      many of whom have dimin- cluded a new record for ship-                cost those selling feeder cat- global market provides a net
      ished purchasing power but  ments to the Philippines.                 tle $129 billion and fed cattle  economic gain.”
      continue to show a strong             For the first eight months      $68 billion, leading to a sig-       The report was commis-
      preference for U.S. red meat.”  of 2022, beef exports in-             nificantly smaller industry.      sioned  by the  Kansas Beef
         August beef exports totaled  creased 5% from a year ago              The authors also calculat- Council,          Oklahoma       Beef
      133,832 mt, up 1% year-over- to 1.004 million mt, valued at           ed the impact on individual  Council and  Texas Beef
      year and the second largest  $8.23 billion – a remarkable             states. In the case of a 10%  Council.
      volume on record – trailing  24% above last year’s record             decrease in U.S. beef trade,
      only May 2022, according to  pace.                                    Kansans selling feeder cattle     KLA
      data release by USDA and                                              would experience a $611
                                                                            million loss and those
       FARMERS FACE NEW REALITY IN BEEF SUPPLY CHAIN  selling fed cattle would
              HIGH RETAIL PRICES STRUGGLE TO FIND THEIR WAY BACK TO         see a $1.22 billion loss.
                 FARMERS’ POCKETS BECAUSE OF DISTRIBUTION COSTS.            If completely eliminat-
                                  By Scott Brown                            ed, feeder cattle sellers
         Cattle prices have been                                            in  Kansas  could  stand
      moving higher, but not to the                                         to lose $9.1 billion over
      same extent as beef prices.                                           a 10-year period.
         For the first eight months                                           Additionally, the re-
      of this year, fed-steer prices
      are 18.9% above the 2018-19
      average for January-August.                                                                           Coming Sales-30
      Feeder steer prices are up
      13.2%. While these are solid                                                                          Life is Simple-5
      increases, they fail to match                                                                         Market Report-8
      the rise in Choice boxed beef                                                                         Agribusiness
      prices (+22.1%) and Choice
      retail beef prices (+27.4%)        BEYOND THE FARM GATE: All along                                    Directory-28
                                         the supply chain, there is an increasing
      over the same period.              cost of doing business, whether that
         There have always been          is labor, transportation or even the
                                         storeroom clerk. All these inputs add up
                    continued on page 12  to higher retail beef prices.
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