Global Update of U.S. Red Meat Exports Courtney Heller U.S. Meat Export Federation 10/28/2009
USMEF Worldwide Denver Monterrey Mexico City Caribbean* C/S America Brussels St. Petersburg Moscow Beijing Seoul Beirut* Tokyo Shanghai Taipei Guangzhou Hong Kong Singapore *Consultants
Global Red Meat Consumption Closely Follows Growth in GDP Global Red Meat Consumption (MMT) 180 160 140 120 100 80 60 40 20 0 0 10 20 30 40 Global GDP Trillion US$ Source: World Bank, *USDA estimates
Is red meat consumption in the U.S. at a saturation point? Pounds 140 U.S. Red Meat Consumption Per Capita, Retail Weight, Annual 120 100 Pork 80 60 40 20 Beef 0 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 Source: USDA
Exports have been a growth market 160 for U.S. red meat 140 120 Growth in Red Meat Consumption: million mt 100 80 60 40 20 0 Rest of World 387% U.S. 58% '60 '65 '70 '75 '80 '85 '90 '95 '00 '05 Source: USDA
U.S. Beef Exports Thousand MT 2008: 984,712 MT, +28% $3.62 Billion, +38% 1,400 1,200 1,000 Variety Meats Beef 800 600 400 200 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009F Source: USDA/USMEF
U.S. Beef Exports to Top Markets 400 350 300 250 200 150 2003 2007 2008 100 50 0 M exico Canada Korea Jap an M id East ASEAN Russia EU Source: USDA/USMEF Forecast, thousand MT, includes variety me
U.S. Pork Exports & Forecast 2,500,000 2,000,000 2008: 2.05 MMT +57% 2009 Forecast: -2% 1,500,000 1,000,000 PVM Pork 500,000 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009F Source: USDA/USMEF, metric tons, 2009F based on preliminary USMEF 2009 forecast
Thousand MT 500 450 400 350 300 250 200 150 100 50 0 Top Markets for U.S. Pork Japan Mexico China/HK Exports Russia Canada Korea 2007 2008 Europe ASEAN C/S Amer Source: USDA/USMEF Preliminary 2009 Forecast, includes variety meats
US Pork Exports as Percent Production 25% 20% 2008: 1 in 4 hogs exported; 24.4% 15% 10% 5% 0% 2009F 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 Jan-Aug 2009: 22.4% Source: USDA/USMEF, includes variety meats
Value of Exports per Head $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 Slaughtered Jan-Aug 2009: $38.79 compared to $42.48 last year 2008: $42.31 1995 1997 1999 2001 2003 2005 2007 Source: USDA/USMEF, FI Hog Slaughter
U.S. Processed Meat Exports 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Canada Mexico Jan-June 09: Canada +6%, Mexico +29% 2004 2005 2006 2007 2008 1H08 1H09 Source: Global Trade Atlas, MT
Trade Barriers Sanitary and Phytosanitary Measures (SPS) Under the WTO SPS agreement, the WTO sets constraints on members' policies relating to food safety and animal and plant health Tariff and quota measures
Multiple Country Trade Issues Ractopamine stalled in Codex process Though beef and pork, largely a pork issue Trichinae U.S. pork negligible risk Many countries maintain mitigation requirements H1N1 - issue dissolving, ban remains in China Major barrier in Spring Country or State bans Mexico due to market issues Animal ID programs More countries are implementing domestic requirements, leading to import requirements
China Pork Ractopamine ban Still not provided the actual data from their recent trials (essentially over feeding or mis-use trials) to CODEX H1N1 U.S. pork banned (Canada and four EU countries) Exception, cooked pork and intestines for manufacturing of casings Exterior of the shipping containers have to sanitized prior to departure from the U.S.» USMEF has compiled scientific literature on this topic and provided it to USDA in Beijing Cooked poultry Zero tolerance for pathogens on raw meat, fat and offals Pre-notification system not functioning properly Beef BSE related ban
Hong Kong Beef Boneless, < 30 months Engaging now to change Requesting 3 step process
Vietnam Zero tolerance on pathogens Request MRL's for various tissues including smooth muscle tissues, intestines, skin, etc.
Opportunities: Greater China (includes Vietnam and Hong Kong) Massive growth in beef utilization: chuck short rib short plate huge items Continued growth in U.S. pork processing ingredient dependent on Chinese pork production
Pork Taiwan Ractopamine ban, linked to CODEX Beef All eligible However, commercially, <30 months
Korea Beef- recall FTA of 2008 Heavily politicized Complicate the U.S. ability to expand access in other markets too Allows for all beef products but commercial agreement limits to < 30 months of age with no processed products or ground beef items Confirmatory test on small intestine imports indicated; high error rate (>5%) so no shipments Restrictions on point of sale labeling: U.S. Natural" and Antibiotic Free if not compliant with Korean domestic regulations and audited by Korean auditors Domestic animal identification program Tracing from the port of entry to the point of sale on imported meat products, December of 2010
Opportunities: Korea Expansion of the use of chuck roll alternative cuts Boneless chuck country style ribs Larger chuck flap from BIG fabrication method
Japan Beef Cattle less then 20 months of age Stricter SRM definition (domestic) than US or OIE GOJ is pressuring the U.S. to investigate every mis-pack; resources not available All Species Positive list; MRL's sanctions policy 1 violation results in 50% inspection 2 violations results in 100% inspection
Opportunities: Japan Beef Full carcass utilization Food service Due to 20 month age restriction Utilizing lower grades of beef Due to 20 month age restriction Pork Strong demand for U.S. pork products
Australia Raw pork banned from U.S Restrictions due to PRRS and PCVAD Research projects on virus inactivation underway
Opportunities: Australia Case by case attempts for pre-cooked bacon
Russia All species Pre-notification system frequently breaks down, does not prevent fraud Zero tolerance for and residues microbes, results in rejected product and delisted facilities Pork Pork certificate negotiations ongoing uncertainty stopped trade twice this summer Beef <30 and U.S. raised All ages, 2007 certificate was negotiated, but not finalized due to an origin issue Tariffs Expected to try to reduce US quota for pork
Opportunities: Russia Beef liver Kidneys and hearts Pork for processing Kaliningrad, free trade region, huge processing industry St. Pete, Vlad and Moscow Beef for processing Kaliningrad St. Pete, Vlad and Moscow
European Union Non-hormone treated cattle Traceability from birth Labeling requirements Quality Manual Pork for the EU Ractopamine ban Traceability from birth Quality manual Antimicrobial Treatment Ban Limits trade - HACCP programs Residue testing Location of stomach opening
Opportunities: EU High Quality Beef Zero duty quota MFN AMT approval inclusion Processed product and ground beef slowly growing
Mexico Port of Entry Requirements Misaligned with U.S.: bruising, hair, copper, edible ink, documentation errors Combo bins proposed ban and 100% inspection - postponed Beef Anti-Dumping Duties Five prohibited beef products BSE related, not OIE compliant Mexico NOM-30
Mexico Opportunities Well established market for pork, beef and lamb Retail Branded products Some growth in further processed Primals and portion cuts Hospitability, restaurant and institution Primals and portion cuts Branded products
Opportunities: Canada Deli meats and processed products, retail Heat and Serve Food Service - ribs Retail - entrees Safety focused Listeria and E. coli Partnerships for further processing in U.S. Location (S to N shipping is cheaper than intra-canada) Large under serviced ethnic market
Additional SPS Barriers Egypt - <30 month beef requirement UAE Fees All ages to <30 for beef in February Jamaica ban on all U.S. pork Old psuedorabies virus ban Kuwait ban on beef from AL (BSE), thus U.S. Argentina beef ban due to FMD issue with U.S. Chile onerous labeling requirements for beef
Additional Opportunities Philippines - Growth in U.S. pork utilization, especially for processing Egypt Beef liver, kidney and heart Future market for pork (non-muslim demographic) ASEAN - Slow growth in demand for alternative chuck roll items Asia Large demand for more than prime beef: dry aged prime and more
USMEF RFP Potential Country Specific Import Requirements for Animal/Product Traceability and the Impact on U.S. Red Meat Exports, proposals due Dec. 4, 2009 www.usmef.org, Notes Direct enquiries to: Paul Clayton Tel: 303-226-7331 E-mail: pclayton@usmef.org
Helpful Websites for Exporting Red Meat and Red Meat Products 1. U.S. Meat Export Federation - www.usmef.org 2. USDA, Foreign Agricultural Service - http://www.fas.usda.gov/ 3. FSIS Export Page - http://www.fsis.usda.gov/regulations_&_polici es/export_information/index.asp 4. USDA, Ag Marketing Service, Beef and Lamb Export Verification page - http://www.ams.usda.gov/amsv1.0/ams.fetcht emplatedata.do?template=templaten&navid= EVBovine&rightNav1=EVBovine&topNav=&left Nav=GradingCertificationandVerfication&page =LSEVBovine&resultType=&acct=audrevcom
Thank you Courtney Heller USMEF 303-623-6328 cheller@usmef.org